Gates Industrial Corporation plc (GTES)
Return on total capital
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 424,400 | 375,100 | 449,000 | 214,400 | 352,000 |
| Long-term debt | US$ in thousands | 2,415,000 | 2,426,400 | 2,526,500 | 2,666,000 | 2,912,300 |
| Total stockholders’ equity | US$ in thousands | 3,220,200 | 3,110,000 | 3,099,700 | 2,805,700 | 2,651,000 |
| Return on total capital | 7.53% | 6.78% | 7.98% | 3.92% | 6.33% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $424,400K ÷ ($2,415,000K + $3,220,200K)
= 7.53%
The return on total capital for Gates Industrial Corporation plc has varied over the past five years. In 2023, the return on total capital increased to 7.53% from 6.78% in 2022, indicating improved efficiency in generating profits relative to the total capital employed. The return on total capital was highest in 2021 at 7.98%, suggesting effective utilization of the company's total capital investments that year. In 2020, the return on total capital was lower at 3.92%, reflecting a decrease in profitability relative to the total capital employed. However, the return on total capital rebounded in 2019 to 6.33%, indicating a recovery in profitability relative to the total capital utilized. Overall, the trend in the return on total capital for Gates Industrial Corporation plc shows fluctuations but generally demonstrates the company's ability to generate returns on its total capital investments over the years.
Peer comparison
Dec 31, 2023