Universal Corporation (UVV)
Return on total capital
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 216,980 | 208,122 | 193,077 | 180,224 | 185,085 | 178,660 | 166,389 | 156,124 | 152,987 | 162,098 | 160,747 | 146,520 | 141,776 | 110,120 | 97,055 | 125,492 | 126,822 | 155,620 | 154,764 | 161,456 |
| Long-term debt | US$ in thousands | 617,364 | 617,225 | 617,086 | 616,948 | 616,809 | 616,750 | 518,923 | 518,798 | 518,547 | 518,547 | 518,422 | 518,297 | 518,172 | 518,047 | 368,894 | 368,829 | 368,764 | 368,698 | 368,633 | 368,568 |
| Total stockholders’ equity | US$ in thousands | 1,437,210 | 1,417,080 | 1,384,190 | 1,380,720 | 1,397,090 | 1,360,790 | 1,324,850 | 1,325,760 | 1,340,540 | 1,316,000 | 1,297,330 | 1,303,820 | 1,307,300 | 1,270,520 | 1,239,500 | 1,236,240 | 1,246,660 | 1,309,800 | 1,298,660 | 1,310,340 |
| Return on total capital | 10.56% | 10.23% | 9.65% | 9.02% | 9.19% | 9.03% | 9.02% | 8.46% | 8.23% | 8.84% | 8.85% | 8.04% | 7.77% | 6.16% | 6.03% | 7.82% | 7.85% | 9.27% | 9.28% | 9.62% |
March 31, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $216,980K ÷ ($617,364K + $1,437,210K)
= 10.56%
The return on total capital for Universal Corporation has shown a generally positive trend over the past few quarters, with fluctuations observed. The ratio ranged from 6.03% to 10.56% over the period under review.
The return on total capital measures the efficiency of the company in generating profits from its total capital employed, including both debt and equity. A higher return on total capital indicates that the company is effectively utilizing its resources to generate profits.
Universal Corporation's return on total capital averaged around 8.78% over the period, indicating that, on average, the company generated approximately $0.0878 in profit for every dollar of capital invested. This suggests that Universal Corporation has been moderately successful in generating returns on its total capital.
It is important for Universal Corporation to continue monitoring and improving its return on total capital to ensure sustainable profitability and efficiency in its capital utilization. The company may consider strategies to enhance this ratio further, such as optimizing its capital structure, improving operational efficiency, or exploring more profitable investment opportunities.
Peer comparison
Mar 31, 2024