Harmony Biosciences Holdings (HRMY)

Return on total capital

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	195,113	179,582	182,381	207,927	192,030	199,447	146,839	133,053	120,186	101,204	110,356	100,552	87,529	66,656	55,983
Long-term debt	US$ in thousands	163,016	167,847	171,422	174,996	178,566	182,131	180,487	185,063	189,647	189,725	189,807	189,896	189,984	190,069	195,610
Total stockholders’ equity	US$ in thousands	659,155	596,804	538,583	515,394	466,992	481,332	485,172	443,041	402,838	343,884	246,533	214,503	186,507	152,018	126,551
Return on total capital		23.73%	23.49%	25.69%	30.12%	29.75%	30.06%	22.06%	21.18%	20.29%	18.97%	25.29%	24.86%	23.25%	19.49%	17.38%

December 31, 2024 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $195,113K ÷ ($163,016K + $659,155K)
= 23.73%

Harmony Biosciences Holdings has shown a fluctuating trend in its return on total capital over the reported periods. The ratio has been improving overall, starting at 17.38% in June 30, 2021, and reaching a peak of 30.12% in March 31, 2024. However, there have been some periods of decline and variability in between these points.

The ratio increased steadily from June 30, 2021, to September 30, 2022, showing a positive trend in the company's ability to generate returns on its total capital. The highest points were observed in September 30, 2023, and March 31, 2024, where the return on total capital exceeded 30%, indicating efficient capital utilization by the company during those periods.

However, there was a slight decline in the ratio in June 30, 2024, and December 31, 2024, compared to the peak in March 31, 2024. These decreases may be attributed to various factors such as changes in the company's financial structure, profitability, or capital allocation strategies during those specific periods.

Overall, the return on total capital trend of Harmony Biosciences Holdings suggests that the company has been successful in generating adequate returns relative to its total capital base, although some fluctuations have been observed. It is essential for stakeholders to monitor this ratio continuously to assess the company's efficiency in utilizing its capital resources effectively.