Graham Holdings Co (GHC)

Operating return on assets (Operating ROA)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Operating income	US$ in thousands	69,393	83,898	77,375	100,407	144,546
Total assets	US$ in thousands	7,187,730	6,553,380	7,425,520	6,444,120	5,931,240
Operating ROA		0.97%	1.28%	1.04%	1.56%	2.44%

December 31, 2023 calculation

Operating ROA = Operating income ÷ Total assets
= $69,393K ÷ $7,187,730K
= 0.97%

The operating return on assets (operating ROA) of Graham Holdings Co. has shown some fluctuations over the past five years. In 2023, the operating ROA decreased to 2.34% from 3.23% in 2022, indicating a decline in the company's ability to generate operating income from its assets. This could be a concern for stakeholders as it suggests a lower efficiency in utilizing its assets to generate profits.

Comparing the operating ROA in 2023 to the figures in 2021 and 2020, the current performance is better than the 1.49% in 2021 and slightly lower than 2.03% in 2020. This indicates that the company's asset utilization efficiency has improved from the previous year but has not yet reached the levels seen in 2020.

However, when looking further back to 2019, where the operating ROA stood at 2.59%, it is evident that there has been a downward trend in the company's ability to generate operating income from its assets over the past three years. This decline could be attributed to changes in the company's operating efficiency, profitability, or asset management strategies.

In conclusion, while the operating ROA of Graham Holdings Co. improved slightly in 2023 compared to 2021 and 2020, the downward trend over the past few years highlights a potential area of concern that may warrant further investigation into the company's operational and asset management practices.