Signet Jewelers Ltd (SIG)
Return on total capital
| Feb 1, 2025 | Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 110,700 | 621,500 | 464,700 | 901,300 | -57,700 |
| Long-term debt | US$ in thousands | 0 | 0 | 147,400 | 147,100 | 146,700 |
| Total stockholders’ equity | US$ in thousands | 1,851,800 | 2,166,500 | 1,578,600 | 1,564,000 | 1,190,300 |
| Return on total capital | 5.98% | 28.69% | 26.92% | 52.67% | -4.32% |
February 1, 2025 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $110,700K ÷ ($0K + $1,851,800K)
= 5.98%
Signet Jewelers Ltd's return on total capital has displayed significant fluctuations over the past five years. Starting from a negative return of -4.32% on January 30, 2021, the company made a substantial improvement in its performance, recording a remarkable return of 52.67% on January 29, 2022. This steep increase was followed by more moderate but still positive returns of 26.92% on January 28, 2023, 28.69% on February 3, 2024, and 5.98% on February 1, 2025.
The sharp rise in return on total capital from a negative position to over 50% in 2022 suggests that Signet Jewelers was able to enhance its capital management efficiency significantly. However, the subsequent lower returns indicate a potential slowdown in capital utilization effectiveness or a shift in the company's investment strategies.
Overall, the positive trajectory of Signet Jewelers' return on total capital demonstrates improvements in how the company is utilizing its capital resources to generate profits, although the recent dip warrants further monitoring to assess the sustainability of its performance.