MGP Ingredients Inc (MGPI)
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 | 148,738 | 146,213 | 125,623 | 54,868 | 47,242 |
| Long-term debt | US$ in thousands | 280,849 | 29,510 | 35,266 | 38,271 | 40,658 |
| Total stockholders’ equity | US$ in thousands | 850,492 | 746,724 | 644,755 | 262,526 | 231,044 |
| Return on total capital | 13.15% | 18.84% | 18.47% | 18.24% | 17.39% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $148,738K ÷ ($280,849K + $850,492K)
= 13.15%
Based on the data provided, MGP Ingredients, Inc.'s return on total capital has been relatively stable over the past five years, ranging from 12.35% in 2021 to 17.94% in 2020. The company's return on total capital increased to 15.02% in 2022 and further to 15.36% in 2023. This indicates that the company has been effectively utilizing its total capital to generate income for its investors and stakeholders, although there was a slight dip in 2021.
Overall, the consistent performance in return on total capital suggests that MGP Ingredients, Inc. has been efficiently managing its capital structure and investments to generate returns for its shareholders. The company's ability to maintain a healthy return on total capital is a positive indication of its financial health and operational efficiency.