STERIS plc (STE)

Return on total capital

		Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021	Mar 31, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	672,120	266,554	405,114	555,243	538,833
Long-term debt	US$ in thousands	3,120,160	3,018,660	2,945,480	1,650,540	1,150,520
Total stockholders’ equity	US$ in thousands	6,302,160	6,077,200	6,532,360	3,880,990	3,405,360
Return on total capital		7.13%	2.93%	4.27%	10.04%	11.83%

March 31, 2024 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $672,120K ÷ ($3,120,160K + $6,302,160K)
= 7.13%

The return on total capital for STERIS plc has varied over the past five years. In the most recent fiscal year ending March 31, 2024, the return on total capital was 7.13%, showing an improvement from the previous year's 2.93%. This indicates that the company was able to generate a higher return on the total capital employed in its operations.

However, when compared to the returns of 4.27% in 2022, 10.04% in 2021, and 11.83% in 2020, the return on total capital for the most recent year appears to be lower. This downward trend in returns may suggest that the company's efficiency in utilizing its total capital to generate profits has decreased over the past few years.

It would be important for stakeholders to further investigate the reasons behind the fluctuating returns on total capital to determine the factors influencing the company's overall profitability and operational efficiency.