McCormick & Company Incorporated (MKC)
Return on total capital
| Nov 30, 2024 | Aug 31, 2024 | May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,181,900 | 1,175,900 | 1,123,800 | 1,105,100 | 1,063,300 | 1,017,500 | 1,072,100 | 1,001,400 | 999,700 | 1,004,300 | 962,000 | 1,052,800 | 1,084,600 | 1,087,300 | 1,096,000 | 1,102,000 | 1,057,900 | 1,085,600 | 1,069,100 | 1,022,300 |
| Long-term debt | US$ in thousands | 3,593,600 | 3,343,100 | 3,325,800 | 3,329,100 | 3,339,900 | 3,385,300 | 4,117,600 | 3,619,800 | 3,642,300 | 3,904,800 | 3,920,300 | 3,964,500 | 3,973,300 | 3,985,000 | 4,735,900 | 4,739,200 | 3,753,800 | 3,737,500 | 4,113,600 | 3,627,900 |
| Total stockholders’ equity | US$ in thousands | 5,291,000 | 5,421,500 | 5,327,400 | 5,232,500 | 5,060,700 | 5,049,300 | 4,937,000 | 4,870,100 | 4,680,500 | 4,589,300 | 4,598,200 | 4,597,700 | 4,411,000 | 4,386,500 | 4,325,300 | 4,149,500 | 3,926,100 | 3,932,700 | 3,649,900 | 3,561,900 |
| Return on total capital | 13.30% | 13.42% | 12.99% | 12.91% | 12.66% | 12.06% | 11.84% | 11.80% | 12.01% | 11.82% | 11.29% | 12.30% | 12.94% | 12.99% | 12.10% | 12.40% | 13.77% | 14.15% | 13.77% | 14.22% |
November 30, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $1,181,900K ÷ ($3,593,600K + $5,291,000K)
= 13.30%
The return on total capital for McCormick & Company Incorporated has shown some fluctuations over the past few years. From February 2020 to November 2024, the return on total capital ranged between 11.29% and 14.22%. The trend indicates a slight decrease in the return on total capital from 14.22% in February 2020 to 13.30% in November 2024. However, there were periods of slight increase in between.
The return on total capital is a key financial ratio that measures how effectively a company generates profits from its capital investments. A higher return on total capital indicates that a company is utilizing its capital efficiently to generate profits, while a lower return may suggest inefficiencies in capital allocation or operational performance.
It is important for McCormick & Company to monitor and manage its return on total capital to ensure sustainable profitability and efficient use of resources. Further analysis of the company's operational performance, capital structure, and investment strategies may help identify factors influencing the fluctuations in the return on total capital and inform decision-making aimed at improving financial performance.