Commercial Metals Company (CMC)

Operating return on assets (Operating ROA)

		Aug 31, 2024	Aug 31, 2023	Aug 31, 2022	Aug 31, 2021	Aug 31, 2020
Operating income	US$ in thousands	-268,126	389,704	1,194,060	9,431	-227,282
Total assets	US$ in thousands	6,817,840	6,639,090	6,237,030	4,638,670	4,081,730
Operating ROA		-3.93%	5.87%	19.14%	0.20%	-5.57%

August 31, 2024 calculation

Operating ROA = Operating income ÷ Total assets
= $-268,126K ÷ $6,817,840K
= -3.93%

Commercial Metals Company's operating return on assets (operating ROA) has been fluctuating over the past five years. In 2024, the operating ROA was negative at -3.93%, indicating that the company's operating income generated from its assets was insufficient to cover its operating expenses. This suggests inefficiency in asset utilization.

In 2023, the operating ROA improved to 5.87%, signaling a better performance in generating operating income relative to its assets. This positive trend continued in 2022 with a significantly higher operating ROA of 19.14%, indicating improved efficiency and profitability in utilizing its assets to generate income.

However, in 2021, the operating ROA dropped to a mere 0.20%, reflecting a decrease in operating income generated from the company's assets. This could indicate potential issues with operational efficiency or profitability during that period.

The most concerning performance was in 2020 when the operating ROA was negative at -5.57%, suggesting that the company was experiencing significant operating losses relative to its asset base. This signifies poor asset utilization and operational performance during that year.

Overall, Commercial Metals Company's operating ROA has shown variability, with notable improvements in 2022 but with some concerning performance in 2020 and 2021. Further analysis would be needed to understand the underlying reasons behind these fluctuations and to assess the company's asset management and operational efficiency strategies.