The AES Corporation (AES)
Operating return on assets (Operating ROA)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | -93,000 | -530,000 | -173,000 | 338,000 | 671,000 |
| Total assets | US$ in thousands | 44,799,000 | 38,363,000 | 32,963,000 | 34,603,000 | 33,648,000 |
| Operating ROA | -0.21% | -1.38% | -0.52% | 0.98% | 1.99% |
December 31, 2023 calculation
Operating ROA = Operating income ÷ Total assets
= $-93,000K ÷ $44,799,000K
= -0.21%
Operating return on assets (Operating ROA) measures a company's ability to generate operating income from its assets. AES Corp.'s Operating ROA has shown a declining trend over the past five years, decreasing from 6.40% in 2019 to 5.02% in 2023. This decline indicates that the company's operating income relative to its assets has been decreasing over time.
The largest decline in Operating ROA was observed from 2021 to 2022, where it dropped from 7.72% to 6.10%. This could suggest a decrease in operational efficiency or profitability during that period. However, it is important to consider the reasons behind this decline, such as changes in business strategy, economic conditions, or industry-specific factors.
Overall, AES Corp.'s Operating ROA remains positive, indicating that the company continues to generate operating income from its assets. However, management may need to assess and address the factors contributing to the declining trend to improve operational performance and asset utilization in the future.