Innospec Inc (IOSP)

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	161,600	187,300	132,100	33,700	149,900
Long-term debt	US$ in thousands	—	—	—	0	58,600
Total stockholders’ equity	US$ in thousands	1,147,100	1,038,000	1,032,400	944,400	-74,400
Return on total capital		14.09%	18.04%	12.80%	3.57%	—

December 31, 2023 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $161,600K ÷ ($—K + $1,147,100K)
= 14.09%

Return on total capital is a key financial metric that indicates the efficiency and profitability of a company in generating returns from its total invested capital.

Innospec Inc's return on total capital has fluctuated over the past five years, with the highest return recorded in 2022 at 18.04% and the lowest in 2020 at 7.92%. The company's return on total capital for the most recent year, 2023, stands at 14.09%.

The trend in return on total capital reflects the company's ability to effectively utilize both its equity and debt capital to generate profits. A higher return on total capital indicates that the company is efficiently deploying its resources to generate profits for its stakeholders.

Overall, while there have been fluctuations in the return on total capital over the years, the company has generally maintained a reasonable level of return, which indicates that it has been able to generate satisfactory returns for the capital invested in the business.