Avanos Medical Inc (AVNS)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 64.63% | 48.67% | 49.35% | 53.04% | 58.92% |
| Operating profit margin | 0.71% | 4.38% | 1.40% | -6.94% | -8.16% |
| Pretax margin | -10.18% | 8.05% | 0.98% | -8.99% | -9.38% |
| Net profit margin | -10.52% | 6.23% | 0.85% | -4.15% | -6.72% |
Avanos Medical Inc's profitability ratios indicate mixed performance over the past five years. The gross profit margin has shown some fluctuations but generally improved from 48.93% in 2021 to 56.39% in 2023, suggesting the company has been able to effectively manage its cost of goods sold.
However, the operating profit margin has been more volatile, with a significant decrease from 9.45% in 2022 to 2.60% in 2023. This may signal challenges in controlling operating expenses or maintaining operational efficiency.
The pretax margin has also been inconsistent, fluctuating between negative and positive figures. In 2023, the pretax margin stood at -1.17%, indicating that the company faced challenges in generating profits before accounting for taxes.
The net profit margin, which reflects the company's bottom line profitability, has been negative in 2023 at -9.18%, compared to positive figures in the preceding years. This suggests that Avanos Medical Inc may have experienced difficulties in generating net income after accounting for all expenses.
Overall, Avanos Medical Inc's profitability ratios show a mixed performance with some areas of improvement in gross profit margin but challenges in operating profit margin, pretax margin, and net profit margin. Further analysis of the company's cost structure and revenue generation strategies may provide insights into addressing the profitability challenges.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 0.25% | 1.99% | 0.65% | -2.90% | -3.10% |
| Return on assets (ROA) | -3.65% | 2.83% | 0.39% | -1.73% | -2.55% |
| Return on total capital | -3.62% | 4.96% | 0.76% | -3.75% | -3.22% |
| Return on equity (ROE) | -5.00% | 3.91% | 0.50% | -2.30% | -3.61% |
Avanos Medical Inc's profitability ratios have shown fluctuations over the past five years.
1. Operating return on assets (Operating ROA) indicates the company's ability to generate profits from its assets before interest and taxes. In 2023, the Operating ROA was 1.03%, lower than the previous year but still positive. This suggests that the company's operational efficiency declined slightly in 2023 compared to 2022.
2. Return on assets (ROA) measures the company's overall ability to generate profit from its assets. In 2023, the ROA was negative at -3.65%, a significant decline from the positive values in the previous two years. This negative trend indicates that Avanos Medical Inc experienced challenges in effectively utilizing its assets to generate profits in 2023.
3. Return on total capital reflects the company's ability to generate returns for all contributors of capital, including both debt and equity holders. The return in 2023 was 1.25%, lower than the previous year but still positive. This indicates that the company's overall profitability decreased slightly in 2023 compared to 2022.
4. Return on equity (ROE) measures the return generated for the company's equity shareholders. A negative ROE of -5.00% in 2023 suggests that Avanos Medical Inc experienced a loss attributable to shareholders' equity in that year. This decline in profitability further emphasizes the challenges faced by the company in generating returns for its shareholders.
Overall, the profitability ratios of Avanos Medical Inc in 2023 indicate a mixed performance with declines in certain metrics and challenges in effectively utilizing assets to generate profits. It is essential for the company to assess and address the factors contributing to these declines to improve its overall profitability and return to positive growth trends.