PPG Industries Inc (PPG)
Return on total capital
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,956,000 | 2,084,000 | 1,927,000 | 1,818,000 | 1,518,000 | 1,474,000 | 1,490,000 | 1,515,000 | 1,934,000 | 1,984,000 | 2,114,000 | 1,664,000 | 1,488,000 | 1,538,000 | 1,447,000 | 1,668,000 | 1,767,000 | 1,718,000 | 1,697,000 | 1,810,000 |
| Long-term debt | US$ in thousands | 5,748,000 | 5,596,000 | 6,099,000 | 7,082,000 | 6,503,000 | 6,478,000 | 6,766,000 | 6,834,000 | 6,572,000 | 6,092,000 | 6,387,000 | 5,336,000 | 5,171,000 | 4,828,000 | 4,613,000 | 4,751,000 | 4,539,000 | 4,885,000 | 4,845,000 | 4,626,000 |
| Total stockholders’ equity | US$ in thousands | 7,832,000 | 7,751,000 | 7,614,000 | 7,142,000 | 6,592,000 | 6,034,000 | 6,182,000 | 6,218,000 | 6,286,000 | 6,253,000 | 6,242,000 | 5,839,000 | 5,689,000 | 5,310,000 | 4,832,000 | 4,723,000 | 5,284,000 | 5,247,000 | 5,079,000 | 4,904,000 |
| Return on total capital | 14.40% | 15.61% | 14.05% | 12.78% | 11.59% | 11.78% | 11.51% | 11.61% | 15.04% | 16.07% | 16.74% | 14.89% | 13.70% | 15.17% | 15.32% | 17.61% | 17.99% | 16.96% | 17.10% | 18.99% |
December 31, 2023 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $1,956,000K ÷ ($5,748,000K + $7,832,000K)
= 14.40%
Over the analyzed period, PPG Industries, Inc. has shown a consistent improvement in its return on total capital, reflecting the company's ability to generate profits relative to the total capital deployed in its operations. The return on total capital increased from 12.03% in Q1 2022 to 16.70% in Q4 2023, indicating a positive trend.
This improvement suggests that PPG Industries has been effectively utilizing its capital to generate returns for its investors. A higher return on total capital signifies greater efficiency in deploying both debt and equity to generate profits.
The gradual increase in the return on total capital over the quarters demonstrates management's efforts in enhancing operational performance and profitability. Investors, lenders, and stakeholders can view this positive trend as a favorable indicator of the company's financial health and management effectiveness.
Peer comparison
Dec 31, 2023