Permian Resources Corporation (PR)
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 | 809,460 | 730,974 | 200,032 | -698,769 | 77,586 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 6,336,100 | 2,935,750 | 2,750,720 | 2,603,960 | 3,258,120 |
| Return on total capital | 12.78% | 24.90% | 7.27% | -26.83% | 2.38% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $809,460K ÷ ($—K + $6,336,100K)
= 12.78%
Permian Resources Corp's return on total capital has exhibited fluctuation in recent years. In 2023, the return on total capital stood at 12.06%, representing a decrease from the previous year's level of 21.47% in 2022. This decline indicates a reduction in the company's ability to generate returns from its total capital employed.
Comparing the performance to earlier years, the return on total capital was 10.15% in 2021, -2.43% in 2020, and 2.96% in 2019. The negative return in 2020 indicates that the company experienced a loss in capital efficiency, but it has since rebounded, albeit not reaching the levels seen in 2019 and 2022.
Overall, the trend in Permian Resources Corp's return on total capital suggests variability in the company's ability to effectively utilize its capital to generate profits, with the most recent year showing a moderation in performance compared to the preceding year. Further analysis of the company's operations and financial strategies may be required to pinpoint the factors driving these fluctuations.
Peer comparison
Dec 31, 2023