Vestis Corporation (VSTS)
Return on total capital
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 217,909 | 192,243 | 96,239 | 149,720 |
| Long-term debt | US$ in thousands | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 877,360 | 2,335,810 | 2,331,980 | — |
| Return on total capital | 24.84% | 8.23% | 4.13% | — |
September 30, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $217,909K ÷ ($—K + $877,360K)
= 24.84%
Over the period from September 30, 2020, to September 30, 2023, Vestis Corporation's return on total capital has shown a positive trend, reflecting the company's ability to generate profits relative to the total capital employed in its operations. The return on total capital increased significantly from 4.13% in 2021 to 24.84% in 2023, indicating a substantial improvement in the company's efficiency in utilizing its total capital to generate earnings.
This upward trajectory suggests that Vestis Corporation has been able to enhance its operational performance and profitability over the years, potentially through better cost management, increased revenue generation, or improved capital allocation strategies. The rise in the return on total capital indicates that the company has made effective use of its financial resources to generate a higher return for its capital providers.
Overall, the consistent improvement in Vestis Corporation's return on total capital signifies a positive trend in the company's financial performance and operational efficiency, highlighting its ability to create value for its stakeholders and optimize the utilization of its capital resources effectively.
Peer comparison
Sep 30, 2023