NewMarket Corporation (NEU)

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	641,473	483,045	382,936	281,769	328,615
Long-term debt	US$ in thousands	—	—	—	—	—
Total stockholders’ equity	US$ in thousands	1,461,580	1,077,060	762,407	762,129	759,824
Return on total capital		43.89%	44.85%	50.23%	36.97%	43.25%

December 31, 2024 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $641,473K ÷ ($—K + $1,461,580K)
= 43.89%

Based on the data provided, NewMarket Corporation's return on total capital has shown fluctuation over the period under review. The return on total capital was 43.25% as of December 31, 2020, indicating a strong performance in utilizing both debt and equity to generate profits. However, there was a slight decrease to 36.97% by December 31, 2021, suggesting potential challenges in maintaining the same level of efficiency in capital utilization.

The return on total capital then saw a significant improvement to 50.23% by December 31, 2022, reflecting a more efficient use of capital resources. This sharp increase could signify strategic initiatives or improved operational performance that contributed to higher returns for the company.

Although there was a slight decrease to 44.85% by December 31, 2023, the return on total capital remained robust, indicating that NewMarket Corporation continued to generate substantial returns relative to the capital invested. Finally, by December 31, 2024, the return on total capital was 43.89%, demonstrating consistency in the company's ability to effectively deploy its capital to generate returns.

Overall, the trend in NewMarket Corporation's return on total capital suggests a generally strong performance in capital utilization, with some fluctuations that may be attributed to varying market conditions or strategic decisions made by the company during the period under consideration.