SkyWest Inc (SKYW)

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 494,657 104,069 181,162 275,867 108,802
Long-term debt US$ in thousands 2,136,790 2,562,180 2,941,770 2,717,420 2,801,540
Total stockholders’ equity US$ in thousands 2,408,780 2,113,500 2,347,630 2,267,510 2,139,540
Return on total capital 10.88% 2.23% 3.43% 5.53% 2.20%

December 31, 2024 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $494,657K ÷ ($2,136,790K + $2,408,780K)
= 10.88%

The return on total capital for SkyWest Inc has shown significant fluctuations over the years based on the provided data. In December 2020, the return on total capital was relatively low at 2.20%, indicating that the company was not efficiently generating returns from its total capital.

By December 2021, there was a noticeable improvement in the return on total capital, reaching 5.53%. This suggests that the company was able to enhance its operational efficiency and generate higher returns from its total capital investments.

However, in December 2022, there was a slight decline in the return on total capital to 3.43%, indicating a decrease in the company's ability to generate profits relative to its overall capital base.

The following year, in December 2023, the return on total capital further dropped to 2.23%, reflecting ongoing challenges in efficiently utilizing the company's total capital to generate returns.

By December 2024, there was a significant upturn in the return on total capital to 10.88%, demonstrating a remarkable improvement in the company's performance in efficiently leveraging its capital investments to generate higher returns.

Overall, the return on total capital for SkyWest Inc has exhibited variability, implying fluctuations in the company's efficiency in generating returns from its total capital base over the years. It would be important for stakeholders to monitor this metric closely to assess the company's financial performance and capital utilization strategies.