CAVA Group, Inc. (CAVA)

Pretax margin

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Earnings before tax but after interest (EBT)	US$ in thousands	59,910	14,048	-58,894	-37,274	78,100
Revenue	US$ in thousands	963,713	728,700	564,119	500,072	931,800
Pretax margin		6.22%	1.93%	-10.44%	-7.45%	8.38%

December 31, 2024 calculation

Pretax margin = EBT ÷ Revenue
= $59,910K ÷ $963,713K
= 6.22%

The pretax margin of CAVA Group, Inc. exhibited significant fluctuations over the given period from December 31, 2020, to December 31, 2024. In 2020, the company maintained a positive pretax margin of 8.38%, indicating that before tax expenses, the company retained a proportion of its revenue as profit. However, in 2021, the pretax margin turned negative at -7.45%, signifying that the company's operating expenses or other costs exceeded its revenues during that period, leading to pre-tax losses. This negative trend continued into 2022, with the pretax margin worsening to -10.44%, reflecting increased difficulties in maintaining profitability on a pre-tax basis.

Subsequently, in 2023, a marked improvement was observed, with the pretax margin rising to 1.93%, suggesting that the company managed to return to a marginally profitable pre-tax position. This improvement indicates better operational efficiency or increased revenues relative to expenses. The positive trend persisted into 2024, with the pretax margin increasing further to 6.22%, signifying ongoing recovery and enhanced profitability margin before tax expenses.

Overall, the pattern illustrates a challenging financial period characterized by losses in 2021 and 2022, followed by a period of recovery and positive pre-tax margins in 2023 and 2024. The data indicates a significant turnaround in profitability prospects over the span, reflecting either operational improvements, strategic adjustments, or revenue growth that positively impacted the company's pretax profit relative to its revenues.