Viatris Inc (VTRS)
Return on total capital
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 25,400 | 961,200 | 1,302,000 | 2,093,800 | 2,178,300 | 2,422,600 | 2,598,500 | 2,798,500 | 3,137,200 | 1,831,800 | 1,963,600 | 1,163,800 | 26,600 | 9,700 | -328,800 | 150,000 | 752,400 | 1,582,100 | 1,483,700 | 1,412,600 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 18,635,500 | 19,792,400 | 19,520,000 | 20,014,300 | 20,467,400 | 20,865,600 | 20,843,300 | 20,927,900 | 21,072,300 | 19,182,300 | 19,805,400 | 20,447,700 | 20,492,700 | 21,141,300 | 21,206,900 | 21,414,700 | 22,954,100 | 12,547,900 | 11,746,200 | 11,262,700 |
| Return on total capital | 0.14% | 4.86% | 6.67% | 10.46% | 10.64% | 11.61% | 12.47% | 13.37% | 14.89% | 9.55% | 9.91% | 5.69% | 0.13% | 0.05% | -1.55% | 0.70% | 3.28% | 12.61% | 12.63% | 12.54% |
December 31, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $25,400K ÷ ($—K + $18,635,500K)
= 0.14%
The Return on Total Capital for Viatris Inc has shown fluctuations over the observed period. Starting at a strong level of 12.54% in March 2020, the ratio remained relatively stable around 12% for the next few quarters. However, a significant decline was observed in December 2020, dropping to 3.28%, which was a substantial decrease. The ratio continued to decline over the next few quarters, reaching negative values by June 2021, indicating the company's capital was not generating expected returns during that period.
From March 2022 onwards, there was a gradual improvement in the Return on Total Capital, with values increasing steadily above 5% and reaching a peak of 14.89% in December 2022. This uptrend demonstrated a more efficient utilization of capital and improved profitability for the company.
Subsequently, the ratio started to decline again, dropping to 6.67% by June 2024 and further down to 0.14% by December 2024, signaling a decline in the company's ability to generate returns on its total capital during those periods. Overall, it is essential for Viatris Inc to maintain or improve its Return on Total Capital to ensure efficient use of resources and sustainable profitability in the long run.
Peer comparison
Dec 31, 2024