MGE Energy Inc (MGEE)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 146,262 | 146,385 | 137,743 | 117,294 | 109,997 |
| Long-term debt | US$ in thousands | 763,697 | 718,822 | 585,246 | 614,211 | 519,303 |
| Total stockholders’ equity | US$ in thousands | 1,230,140 | 1,140,070 | 1,081,670 | 1,027,470 | 976,000 |
| Return on total capital | 7.34% | 7.87% | 8.26% | 7.14% | 7.36% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $146,262K ÷ ($763,697K + $1,230,140K)
= 7.34%
Based on the provided data, MGE Energy Inc's return on total capital has fluctuated over the past five years. The trend shows a slight decrease from 7.36% as of December 31, 2020, to 7.14% as of December 31, 2021. However, there was a notable increase in the return on total capital to 8.26% by December 31, 2022. Subsequently, there was a slight decline to 7.87% by December 31, 2023, followed by another decrease to 7.34% by December 31, 2024.
Overall, MGE Energy Inc's return on total capital has demonstrated some variability, with an upward trend in 2022 followed by fluctuations in subsequent years. This indicates that the company's ability to generate returns from its total capital has been somewhat inconsistent during this period. Further analysis and examination of the company's financial performance and capital allocation strategies may be required to gain a deeper understanding of the factors contributing to these fluctuations in return on total capital.