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Delta Air Lines Inc. (DAL)

Return on Capital (ROC)

Difficulty: Advanced

Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company’s debt and equity structure. It measures business productivity performance.

Return on Invested Capital (ROIC)

Delta Air Lines Inc., ROIC calculation

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 5,852  6,350  7,162  7,537  2,136 
Invested capital2 43,364  44,646  36,822  32,688  29,102 
Ratio
ROIC3 13.49% 14.22% 19.45% 23.06% 7.34%

Based on: 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-13), 10-K (filing date: 2016-02-05), 10-K (filing date: 2015-02-11).

2018 Calculations

1 NOPAT. See Details »

2 Invested capital. See Details »

3 ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 5,852 ÷ 43,364 = 13.49%

Ratio Description The company
ROIC A measure of the periodic, after tax, cash-on-cash yield earned in the business. Delta Air Lines Inc.’s ROIC deteriorated from 2016 to 2017 and from 2017 to 2018.