Hillenbrand Inc (HI)
Return on total capital
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | -24,700 | 750,200 | 357,200 | 402,800 | 52,200 |
| Long-term debt | US$ in thousands | 1,872,400 | 1,990,400 | 1,222,100 | 1,212,900 | 1,516,300 |
| Total stockholders’ equity | US$ in thousands | 1,423,000 | 1,630,300 | 1,082,900 | 1,209,600 | 1,059,000 |
| Return on total capital | -0.75% | 20.72% | 15.50% | 16.63% | 2.03% |
September 30, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $-24,700K ÷ ($1,872,400K + $1,423,000K)
= -0.75%
Hillenbrand Inc's return on total capital has exhibited fluctuations over the past five years. In 2024, the company experienced a negative return on total capital of -0.75%, indicating that the company's capital utilization did not generate positive returns during that period. This negative return may be attributed to factors such as lower profitability or inefficient capital allocation.
In contrast, in 2023, Hillenbrand Inc achieved a significantly higher return on total capital of 20.72%, reflecting strong capital efficiency and profitability. The company's ability to generate substantial returns on its total capital in 2023 may indicate effective management of resources and successful operational performance.
The return on total capital for 2022 (15.50%) and 2021 (16.63%) also demonstrated positive performance, showing that Hillenbrand Inc's capital utilization was yielding favorable returns during those years. These consistent returns indicate the company's ability to effectively deploy its capital to generate profits.
In 2020, Hillenbrand Inc saw a lower return on total capital of 2.03%, indicating a less efficient use of capital compared to the following years. This lower return may signify challenges in generating returns on investments or suboptimal capital management during that period.
Overall, the fluctuating trend in Hillenbrand Inc's return on total capital over the past five years suggests varying levels of capital efficiency and performance. It is essential for the company to closely monitor and optimize its capital allocation strategies to maintain consistent and positive returns on its total capital in the future.
Peer comparison
Sep 30, 2024