Olin Corporation (OLN)

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	740,400	1,819,900	1,886,700	-727,300	206,300
Long-term debt	US$ in thousands	2,591,300	2,571,000	2,578,200	3,837,500	3,338,700
Total stockholders’ equity	US$ in thousands	2,232,400	2,543,600	2,652,200	1,450,800	2,417,500
Return on total capital		15.35%	35.58%	36.07%	-13.75%	3.58%

December 31, 2023 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $740,400K ÷ ($2,591,300K + $2,232,400K)
= 15.35%

Based on the return on total capital figures provided for Olin Corp. over the past five years, there has been a significant fluctuation in the company's performance in utilizing its capital effectively.

In 2023, Olin Corp. achieved a return on total capital of 15.48%, indicating a decline from the previous year's level of 34.89%. This decrease may suggest that the company's profitability relative to its invested capital diminished.

The substantial drop in 2020, where the return on total capital turned negative at -0.73%, raises concerns about Olin Corp.'s ability to generate returns from its capital investments during that period. However, the subsequent recovery in 2021 and 2022, with returns of 34.56% and 34.89% respectively, indicates a significant improvement in capital efficiency.

The overall trend in Olin Corp.'s return on total capital reflects variability in the company's performance in converting its invested capital into profits. Investors and stakeholders may need to further investigate the reasons behind the fluctuations to assess the sustainability and efficiency of Olin Corp.'s capital allocation strategies.