Ingevity Corp (NGVT)

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	-437,800	83,200	331,400	214,500	282,200
Long-term debt	US$ in thousands	—	—	—	—	—
Total stockholders’ equity	US$ in thousands	195,200	631,400	698,300	673,800	642,100
Return on total capital		-224.28%	13.18%	47.46%	31.83%	43.95%

December 31, 2024 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $-437,800K ÷ ($—K + $195,200K)
= -224.28%

Based on the provided data, Ingevity Corp's return on total capital has exhibited significant fluctuations over the years.

- In December 31, 2020, the return on total capital was strong at 43.95%, indicating efficient utilization of capital to generate profits.
- In the following year, by December 31, 2021, the return on total capital decreased to 31.83%, suggesting a decline in the company's ability to generate profits relative to the capital employed.
- However, by December 31, 2022, the return on total capital increased notably to 47.46%, indicating a strong recovery or improved capital efficiency.
- The trend reversed again by December 31, 2023, with the return on total capital dropping to 13.18%, signaling a decrease in profitability relative to the total capital invested.
- The most recent data point, as of December 31, 2024, shows a negative return on total capital of -224.28%, which is concerning and indicates substantial losses relative to the total capital deployed.

In summary, Ingevity Corp's return on total capital has been volatile, with fluctuations indicating varying levels of capital efficiency and profitability over the years. The negative return in 2024 highlights a significant challenge that the company may be facing in terms of generating returns on its total capital investment.