Alkermes Plc (ALKS)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 39.97% | 21.76% | 31.46% | 26.72% | 27.92% |
| Operating profit margin | 25.25% | -0.55% | -2.52% | -10.89% | -15.17% |
| Pretax margin | 15.74% | -15.22% | -3.38% | -9.35% | -17.04% |
| Net profit margin | 21.69% | -14.39% | -4.15% | -10.74% | -17.00% |
Based on the data provided, we can see the following trends in Alkermes plc's profitability ratios:
1. Gross Profit Margin: The gross profit margin has fluctuated over the past five years, with a peak in 2019 at 84.59% and a slight decline in 2020 and 2021 before increasing again in 2023 to 84.79%. This indicates that the company has been able to maintain a high percentage of revenue after accounting for the cost of goods sold.
2. Operating Profit Margin: There was a significant improvement in the operating profit margin from negative figures in 2020 and 2021 to a positive 24.90% in 2023. This suggests that the company has been able to effectively control its operating expenses and generate operating income compared to previous years.
3. Pretax Margin: The pretax margin also experienced a substantial recovery in 2023, turning positive at 25.34% after several years of negative margins. This improvement indicates that Alkermes plc has been able to better manage its expenses and generate higher pre-tax profits relative to its revenue.
4. Net Profit Margin: Similarly, the net profit margin showed a positive shift in 2023, reaching 21.39% after being negative in the previous years. This indicates that the company has been able to effectively manage its financial obligations and generate a higher percentage of net income compared to its total revenue.
In conclusion, Alkermes plc has shown improvements in its profitability ratios over the years, particularly in operating profit margin, pretax margin, and net profit margin in 2023, reflecting better cost management and income generation capabilities.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 19.39% | -0.31% | -1.45% | -5.77% | -9.72% |
| Return on assets (ROA) | 16.65% | -8.06% | -2.38% | -5.69% | -10.89% |
| Return on total capital | 18.86% | -11.56% | -2.00% | -6.56% | -13.49% |
| Return on equity (ROE) | 29.58% | -15.16% | -4.33% | -10.39% | -18.11% |
Throughout the years in question, Alkermes plc's profitability ratios have exhibited significant fluctuations.
1. Operating return on assets (Operating ROA) has shown a positive trend since 2020, indicating that the company has been more efficient in generating operating income from its assets. From the negative percentages in 2020 and 2021 (-5.77% and -1.45% respectively), the ratio improved dramatically to 19.39% in 2023.
2. Return on assets (ROA) displays a similar pattern to the Operating ROA, with the company managing to turn around its performance from negative percentages in the range of -8.06% to -10.89% to a positive 16.65% in 2023. This metric suggests that Alkermes plc is now generating a higher level of profits relative to its total assets.
3. Return on total capital has shown volatility, with a positive upturn to 27.73% in 2023 from negative values in the previous years. This ratio reflects the company's ability to generate earnings in relation to its total capital employed, and the recent improvement is a positive sign for investors.
4. Return on equity (ROE) shows a consistent positive trend, with the ratio increasing steadily from -18.11% in 2019 to 29.58% in 2023. This indicates that Alkermes plc has been successful in generating higher returns and creating more value for its shareholders over the years.
Overall, Alkermes plc's profitability ratios have improved significantly in the latest year, suggesting enhanced operational efficiency and financial performance. Investors and stakeholders may find these positive trends encouraging, indicating the company's potential for sustainable growth and profitability.