Driving Growth and Transformation in Agriculture Technology
Reconciliation of Non-GAAP Financial Measures to
Reported Financial Measures
CH
Return on Invested Capital is a non-GAAP measure. Accordingly, Invested Capital and Return on Invested Capital should not be considered in isolation or as a substitute for net earnings, cash
flows from operations or other income or cash flow data prepared in accordance with GAAP or as a measure of our operating performance or liquidity. The table below shows how Invested
Capital and Return on Invested Capital are calculated from our income statement and balance sheet. Return on Invested Capital is calculated as Operating Income (after-tax) divided by the
average of beginning and ending Invested Capital. Invested Capital represents total assets minus total liabilities (excluding interest-bearing debt). Return on Invested Capital is one of our key
operating ratios, as it allows investors to analyze our operating performance in light of the amount of investment required to generate our operating profit. Return on Invested Capital is also a
measurement used to determine management incentives.
Dollars in thousands
2022
2021
2020
2019
Operating income
S
433,249
S
286,785
S
225,953
S
227,905
Adjusted effective tax rate
27.7 %
23.6 %
24.2 %
Tax effect on operating income
(119,872)
(67,681)
(54,681)
23.9 %
(54,469)
After-tax operating income
S
313,377
S
219,104
S
171,272
S
173,436
Average invested capital
S
2,437,232
S
2,176,577
S
1,975,693
$
1,953,120
Return on invested capital
12.9 %
10.1 %
8.7 %
8.9 %
Total assets
$
3,556,996
$
3,447,249
S
2,953,160
S
2,807,216
Less: Accounts payable
(360,312)
(347,841)
(268,099)
(197957)
Less: Accrued expenses
(248,320)
(253,330)
(227,735)
(167,264)
Less: Income Tax Payable
(3,664)
Less: Defined benefit pension asset
(24,216)
Less: Defined benefit pension liability
(536)
(118,523)
(140,007)
Less: Deferred compensation
(30,316)
(35,373)
(44.519)
(45.114)
Less: Other noncurrent liabilities
(13,480)
(89,207)
(58,657)
(8,904)
Less: Dividends payable
(11,742)
(10,616)
(9,556)
(8,079)
Less: Lease liability
(155,469)
(147,759)
(80,202)
(85,817)
Less: Contract liability
(172,915)
(135,746)
(130,018)
(117,945)
Less: Deferred tax liability
(41,091)
(47,849)
(41,689)
(58,906)
Total Invested capital
S
2,495,471
S
2,378,992
S
1,974,162
S
1,977,223
Beginning of year invested capital
S
2,378,992
S
1,974,162
S
1,977,223
S
1,929,016
Average invested capital
$
2,437,232
S
2,176,577
S
1,975,693
S
1,953,120
CONSERVING RESOURCES. IMPROVING LIFE. Valmont
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