Darling Ingredients Inc (DAR)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 468,217 | 966,517 | 1,009,880 | 877,097 | 422,794 |
| Long-term debt | US$ in thousands | 3,911,370 | 4,322,380 | — | — | — |
| Total stockholders’ equity | US$ in thousands | 4,377,810 | 4,605,430 | 3,809,020 | 3,280,960 | 2,891,910 |
| Return on total capital | 5.65% | 10.83% | 26.51% | 26.73% | 14.62% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $468,217K ÷ ($3,911,370K + $4,377,810K)
= 5.65%
The return on total capital for Darling Ingredients Inc has experienced fluctuation over the past five years. Starting at 14.62% in December 2020, the return on total capital showed a significant increase to 26.73% by December 2021, indicating improved efficiency in generating returns relative to the total capital employed. This positive trend was sustained in December 2022, with the return on total capital remaining high at 26.51%.
However, the performance deteriorated in the following years, dropping to 10.83% by December 2023 and further decreasing to 5.65% by December 2024. These declining figures suggest a decrease in the company's ability to generate profits relative to the total capital invested, potentially indicating challenges or inefficiencies in utilizing capital effectively.
Overall, the fluctuations in Darling Ingredients Inc's return on total capital highlight the importance of closely monitoring and analyzing this metric to assess the company's operational efficiency and profitability in utilizing its total capital resources over time.
Peer comparison
Dec 31, 2024