Vir Biotechnology Inc (VIR)

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	-552,170	-684,305	817,576	408,768	-298,719
Long-term debt	US$ in thousands	—	—	—	—	—
Total stockholders’ equity	US$ in thousands	1,150,380	1,590,240	2,077,960	1,431,850	716,852
Return on total capital		-48.00%	-43.03%	39.35%	28.55%	-41.67%

December 31, 2024 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $-552,170K ÷ ($—K + $1,150,380K)
= -48.00%

Based on the provided data, the return on total capital for Vir Biotechnology Inc has experienced significant fluctuations over the years. The ratio stood at -41.67% as of December 31, 2020, indicating that the company's capital was not effectively utilized to generate returns.

However, there was a notable improvement in performance in the following years. By December 31, 2021, the return on total capital had increased to 28.55%, suggesting better efficiency in deploying capital to generate profits.

The trend continued positively in 2022, with the return on total capital further improving to 39.35%. This indicates that the company was making more effective use of its capital to generate higher returns for its investors.

However, the performance deteriorated significantly in the subsequent years. By December 31, 2023, the return on total capital had fallen to -43.03%, reflecting a scenario where the capital employed was not yielding adequate returns.

The situation worsened by December 31, 2024, with the return on total capital plummeting to -48.00%. This sharp decline signifies that a substantial portion of the capital invested was not providing positive returns.

In summary, while there were periods of improvement in the return on total capital for Vir Biotechnology Inc, the overall trend indicates fluctuating and ultimately declining efficiency in capital utilization over the years.