Adient PLC (ADNT)

Operating return on assets (Operating ROA)

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Operating income	US$ in thousands	59,000	-166,000	-86,000	-612,000	-448,000
Total assets	US$ in thousands	9,424,000	9,158,000	10,778,000	10,261,000	10,342,000
Operating ROA		0.63%	-1.81%	-0.80%	-5.96%	-4.33%

September 30, 2023 calculation

Operating ROA = Operating income ÷ Total assets
= $59,000K ÷ $9,424,000K
= 0.63%

To assess the operating return on assets (ROA) of Adient plc, we can utilize the formula: Operating ROA = Operating Income / Average Total Assets.

The trend of Adient plc's operating ROA over the past five years indicates some variations. In 2023, the operating ROA increased to 5.08% from 2.28% in 2022, reflecting an improvement in the company's ability to generate operating profits from its average total assets. This marks a positive development in the company's operational efficiency and indicates a stronger utilization of its assets to generate operating income.

The significant increase in operating ROA from 2022 to 2023 demonstrates an enhanced performance in terms of generating operating income relative to its average total assets. This improvement may be attributed to factors such as cost management, operational efficiency, or revenue growth.

However, it is important to note that the operating ROA of Adient plc fluctuated in the preceding years, with varying levels of performance. In 2021, the operating ROA was 2.68%, compared to 0.33% in 2020 and 1.26% in 2019. These fluctuations suggest that the company's operational efficiency and asset utilization have not been consistent over the years.

Overall, the recent notable increase in operating ROA indicates a positive trend in Adient plc's ability to generate operating income relative to its asset base. It will be essential to monitor future financial periods to assess whether this improvement can be sustained and if the company can maintain its operational efficiency and asset productivity.