Paylocity Holdng (PCTY)

Return on total capital

Jun 30, 2025 Jun 30, 2024 Jun 30, 2023 Jun 30, 2022 Jun 30, 2021
Earnings before interest and tax (EBIT) US$ in thousands — 260,093 155,026 84,594 58,043
Long-term debt US$ in thousands — — — — —
Total stockholders’ equity US$ in thousands 1,233,750 1,033,060 842,863 613,463 476,930
Return on total capital 0.00% 25.18% 18.39% 13.79% 12.17%

June 30, 2025 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $1,233,750K)
= 0.00%

The return on total capital for Paylocity Holding has demonstrated a notable upward trend over the analyzed period from June 30, 2021, to June 30, 2024. Specifically, the figure increased from 12.17% in 2021 to 13.79% in 2022, reflecting a modest improvement in efficiency in generating returns from its total capital base. This upward trajectory continued into 2023, with the return rising to 18.39%, indicating enhanced operational performance or more effective capital utilization.

By June 30, 2024, the return on total capital reached 25.18%, signifying a substantial advancement in the company's profitability relative to its total capital employed. This increase suggests that the company significantly improved its capacity to generate income from its capital investments, possibly due to operational efficiencies, strategic initiatives, or favorable market conditions.

However, a remarkable shift is observed in the subsequent period, with the return on total capital dropping to 0.00% by June 30, 2025. Such a decline could indicate potential anomalies, extraordinary losses, asset impairments, or other unusual factors impacting the company's profitability metrics. Alternatively, it may reflect accounting changes, extraordinary expenditures, or a transition phase affecting the company's ability to generate returns on its total capital.

Overall, the trend indicates substantial growth in the company's efficiency and profitability from 2021 through 2024, followed by an abrupt cessation of returns in the following year. This pattern warrants further investigation into the underlying causes behind the 2025 data point to understand the factors influencing the company's capital return dynamics.