MGE Energy Inc (MGEE)

Return on total capital

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	146,385	150,151	148,846	135,914	137,743	127,057	122,168	120,103	117,294	118,757	119,484	117,611	109,997	113,162	113,575	111,838	110,910	113,023	114,083	118,531
Long-term debt	US$ in thousands	718,822	690,028	651,654	652,804	585,246	561,566	592,689	613,105	614,211	615,311	556,431	518,211	519,303	520,383	521,456	522,614	523,741	490,159	491,217	492,283
Total stockholders’ equity	US$ in thousands	1,140,070	1,135,250	1,112,580	1,098,370	1,081,670	1,075,200	1,056,060	1,048,150	1,027,470	1,028,280	1,007,300	997,711	976,000	973,584	955,171	869,492	855,676	851,234	832,797	828,950
Return on total capital		7.87%	8.23%	8.44%	7.76%	8.26%	7.76%	7.41%	7.23%	7.14%	7.23%	7.64%	7.76%	7.36%	7.57%	7.69%	8.03%	8.04%	8.43%	8.62%	8.97%

December 31, 2023 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $146,385K ÷ ($718,822K + $1,140,070K)
= 7.87%

Over the past few years, MGE Energy Inc's return on total capital has shown a relatively stable trend, fluctuating within a narrow range between 7% and 8%. The company's return on total capital for the most recent quarter was 7.87%, which is slightly below the highest level achieved in the past two years at 8.97%. This indicates that MGE Energy Inc has been able to generate a consistent return on the total capital employed in its operations.

Although the return on total capital has not shown a significant upward or downward trend, it is important to note that the company has been able to maintain a relatively steady performance in terms of generating returns relative to its capital base. This suggests that MGE Energy Inc has been able to effectively utilize its capital to generate profits, albeit at a moderate level.

Overall, while MGE Energy Inc's return on total capital may not have exhibited significant growth, its ability to consistently generate returns within a tight range demonstrates operational stability and efficiency in capital deployment.