Reliance Steel & Aluminum Co (RS)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,177,400 | 1,780,800 | 2,515,000 | 1,967,300 | 701,400 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 7,219,600 | 7,722,300 | 7,087,400 | 6,086,500 | 5,115,400 |
| Return on total capital | 16.31% | 23.06% | 35.49% | 32.32% | 13.71% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,177,400K ÷ ($—K + $7,219,600K)
= 16.31%
Reliance Steel & Aluminum Co's return on total capital has shown fluctuations over the years. The ratio increased significantly from 2020 to 2022, indicating improved efficiency in generating profits relative to the total capital employed. However, there was a decrease in 2023 followed by a further decline in 2024. Despite the recent decreases, the company's return on total capital remains relatively high, suggesting effective utilization of capital to generate returns. Overall, the trend in return on total capital demonstrates varying levels of profitability and capital efficiency over the years.