Pool Corporation (POOL)
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 | 746,567 | 1,025,780 | 832,784 | 464,027 | 341,246 |
| Long-term debt | US$ in thousands | 1,015,120 | 1,361,760 | 1,171,580 | 404,149 | 499,662 |
| Total stockholders’ equity | US$ in thousands | 1,312,790 | 1,235,190 | 1,071,390 | 639,470 | 410,180 |
| Return on total capital | 32.07% | 39.50% | 37.13% | 44.46% | 37.51% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $746,567K ÷ ($1,015,120K + $1,312,790K)
= 32.07%
Pool Corporation's return on total capital has shown fluctuating trends over the past five years. In 2023, the return on total capital decreased to 31.56% from 39.16% in 2022, marking a decline in profitability efficiency. Although the return on total capital in 2023 is lower than the previous year, it remains relatively strong compared to the levels seen in 2021 and 2019. Overall, Pool Corporation has demonstrated a consistent ability to generate returns on its total capital, albeit with some variability from year to year. Analyzing the factors contributing to the changes in the return on total capital could provide insights into the company's operational and financial performance.