International Flavors & Fragrances Inc (IFF)
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 | -2,110,000 | -1,326,000 | 585,000 | 566,000 | 665,000 |
| Long-term debt | US$ in thousands | 9,186,000 | 10,373,000 | 10,768,000 | 3,779,000 | 3,997,440 |
| Total stockholders’ equity | US$ in thousands | 14,611,000 | 17,655,000 | 21,082,000 | 6,310,000 | 6,217,300 |
| Return on total capital | -8.87% | -4.73% | 1.84% | 5.61% | 6.51% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $-2,110,000K ÷ ($9,186,000K + $14,611,000K)
= -8.87%
The return on total capital for International Flavors & Fragrances Inc. has exhibited a declining trend over the past five years, from 6.58% in 2019 to 2.34% in 2023. This indicates a decrease in the company's ability to generate profits from the total capital employed in its operations. The drop in the return on total capital could be a cause for concern as it suggests a decline in the efficiency and profitability of the company's capital utilization. Further analysis is warranted to determine the factors contributing to this downward trend and to identify potential strategies for improvement in the utilization of capital to enhance overall financial performance.
Peer comparison
Dec 31, 2023