Allete Inc (ALE)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 85.78% | 52.26% | 62.34% | 70.39% | 66.08% |
| Operating profit margin | 10.47% | 9.62% | 8.54% | 10.66% | 11.82% |
| Pretax margin | 12.03% | 14.63% | 10.07% | 10.03% | 10.44% |
| Net profit margin | 11.72% | 13.15% | 12.05% | 11.92% | 14.15% |
Allete Inc's profitability ratios have shown some fluctuations over the past five years. The gross profit margin has generally been high, ranging from 62.34% to 85.78%. This indicates that the company is effectively managing its production costs and generating a healthy level of gross profit from its operations.
Meanwhile, the operating profit margin has varied between 8.54% and 11.82%, showing a moderate level of operational efficiency in converting revenue into operating income. The pretax margin has also fluctuated, reaching a high of 14.63% in 2023 and a low of 10.03% in 2021. This suggests that the company's performance before taxes has been somewhat volatile over the years.
Lastly, the net profit margin has ranged from 11.72% to 14.15%, indicating the portion of revenue that translates into net income after accounting for all expenses. The company has demonstrated a consistent ability to generate profits at the bottom line, albeit with some variation in margin levels.
Overall, Allete Inc's profitability ratios reflect a mix of strengths and fluctuations in performance over the years, with a generally strong gross profit margin and varying levels of operating and net profit margins.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 2.37% | 2.72% | 1.96% | 2.36% | 2.27% |
| Return on assets (ROA) | 2.65% | 3.71% | 2.77% | 2.63% | 2.72% |
| Return on total capital | 3.52% | 7.93% | 5.38% | 5.07% | 4.83% |
| Return on equity (ROE) | 6.30% | 8.79% | 7.03% | 7.04% | 7.21% |
Allete Inc's profitability ratios reflect varying levels of performance over the years.
1. Operating return on assets (Operating ROA) remained relatively stable between 2020 and 2021, showing a slight improvement in 2021. However, there was a decrease in 2022, followed by a significant increase in 2023 and minor decline in 2024. This indicates that the company's operating performance in generating profit from its assets experienced fluctuations during the period.
2. Return on assets (ROA) displayed some fluctuations as well. There was a slight decrease in 2021 compared to 2020, followed by an increase in 2022 and a more substantial rise in 2023. However, there was a drop in 2024, indicating some inconsistency in the overall profitability of the firm relative to its total assets.
3. Return on total capital showed an increasing trend from 2020 to 2023, indicating the company's efficient use of both debt and equity capital to generate profit. However, there was a notable decrease in 2024, suggesting potential challenges in optimizing total capital for profitability.
4. Return on equity (ROE) experienced fluctuations throughout the period, with a slight decrease in 2021 compared to 2020, followed by relative stability in 2022 and 2023. There was a decline in 2024, indicating a dip in the company's ability to generate profit from shareholders' equity.
In conclusion, while Allete Inc demonstrated some positive trends in profitability ratios, such as ROA and ROE, there were fluctuations and downward trends in certain years, especially in 2024, which may require attention for sustained profitability in the future.