Allete Inc (ALE)

Return on assets (ROA)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Net income	US$ in thousands	179,300	247,100	189,300	169,200	165,400
Total assets	US$ in thousands	6,754,300	6,656,400	6,845,600	6,422,300	6,084,600
ROA		2.65%	3.71%	2.77%	2.63%	2.72%

December 31, 2024 calculation

ROA = Net income ÷ Total assets
= $179,300K ÷ $6,754,300K
= 2.65%

The return on assets (ROA) of Allete Inc has exhibited fluctuations over the period from December 31, 2020, to December 31, 2024. At the end of 2020, the ROA stood at 2.72%, indicating that for every dollar of assets, the company generated a profit of $0.0272. Subsequently, there was a slight decrease in ROA to 2.63% by the end of 2021. However, the company experienced an improvement in its ROA to 2.77% by the end of 2022.

The most significant increase in ROA was observed in 2023, where it surged to 3.71%, signifying a notable enhancement in profitability relative to its asset base. This could indicate improved efficiency in asset utilization or enhanced profitability measures. Nonetheless, the performance declined in 2024, with the ROA decreasing to 2.65%.

These fluctuations in ROA suggest that Allete Inc's management may need to focus on sustaining or further enhancing profitability relative to its asset base. It is essential for the company to continually monitor and manage its asset utilization and profitability to ensure sustainable financial performance in the future.