LCI Industries (LCII)

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	123,428	553,028	398,410	222,934	200,210
Long-term debt	US$ in thousands	846,834	1,095,890	1,231,960	720,418	612,906
Total stockholders’ equity	US$ in thousands	1,355,040	1,381,010	1,092,880	908,326	800,672
Return on total capital		5.61%	22.33%	17.14%	13.69%	14.16%

December 31, 2023 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $123,428K ÷ ($846,834K + $1,355,040K)
= 5.61%

The return on total capital for LCI Industries has exhibited fluctuations over the past five years. In 2023, the return on total capital decreased to 5.60% from the previous year's level of 22.12% in 2022. This decline indicates a decrease in the company's ability to generate profits from its total capital employed during that period.

Comparing the 2023 return on total capital to the levels in 2021, 2020, and 2019, we observe a similar trend of declining returns over the years. The return on total capital was 16.63% in 2021, 13.54% in 2020, and 13.99% in 2019. This indicates a general downward trend in the company's ability to efficiently utilize its total capital to generate returns for its investors.

Overall, the declining trend in LCI Industries' return on total capital over the past five years may suggest potential inefficiencies in the company's capital utilization or operational performance. It is essential for the company to address these issues and improve its profitability metrics to enhance shareholder value in the future.