Kennametal Inc (KMT)
Return on total capital
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 170,223 | 183,210 | 227,069 | 107,052 | 36,500 |
| Long-term debt | US$ in thousands | 545,900 | 527,400 | 536,100 | 644,200 | 630,200 |
| Total stockholders’ equity | US$ in thousands | 1,249,880 | 1,275,450 | 1,252,580 | 1,329,610 | 1,229,880 |
| Return on total capital | 9.48% | 10.16% | 12.69% | 5.42% | 1.96% |
June 30, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $170,223K ÷ ($545,900K + $1,249,880K)
= 9.48%
Kennametal Inc's return on total capital has shown some fluctuations over the past five years. The return on total capital was 9.48% as of June 30, 2024, a decrease from the previous year's 10.16%. However, compared to two years ago, the return on total capital has declined notably, as it stood at 12.69% as of June 30, 2022. In the earlier years, the return on total capital was lower, with figures of 5.42% and 1.96% for June 30, 2021, and June 30, 2020, respectively.
The varying return on total capital figures indicate fluctuations in the company's ability to generate profits from the total capital employed in its operations. It is important for Kennametal Inc to closely monitor and improve its return on total capital to ensure efficient utilization of resources and sustainable profitability.