Gates Industrial Corporation plc (GTES)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 39.86% | 38.06% | 35.19% | 38.54% | 37.05% |
| Operating profit margin | 14.05% | 12.96% | 10.80% | 13.93% | 7.56% |
| Pretax margin | 8.87% | 7.32% | 6.63% | 9.08% | 2.15% |
| Net profit margin | 5.72% | 6.52% | 6.21% | 8.55% | 2.84% |
Based on the provided data, Gates Industrial Corporation plc has shown improvements in its profitability ratios over the years:
1. Gross Profit Margin:
- The company's gross profit margin has generally been increasing, from 37.05% in 2020 to 39.86% in 2024. This indicates efficient cost management in the production of goods.
2. Operating Profit Margin:
- Gates Industrial Corporation plc has shown significant growth in its operating profit margin, rising from 7.56% in 2020 to 14.05% in 2024. This suggests improved operational efficiency and better control over operating expenses.
3. Pre-tax Margin:
- The pre-tax margin has also shown a positive trend, increasing from 2.15% in 2020 to 8.87% in 2024. This signifies better profitability before accounting for taxes.
4. Net Profit Margin:
- Although the net profit margin peaked in 2021 at 8.55%, it has since decreased to 5.72% in 2024. This may indicate increased expenses or other factors affecting net profitability.
Overall, Gates Industrial Corporation plc has demonstrated a strong performance in terms of profitability, as evidenced by improvements in gross profit margin, operating profit margin, and pre-tax margin. However, attention may be needed to manage expenses effectively to maintain or enhance net profit margin in the future.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 7.05% | 6.38% | 5.34% | 6.43% | 2.84% |
| Return on assets (ROA) | 2.87% | 3.21% | 3.07% | 3.94% | 1.07% |
| Return on total capital | 8.97% | 7.53% | 6.78% | 7.98% | 3.92% |
| Return on equity (ROE) | 6.45% | 7.23% | 7.10% | 9.58% | 2.83% |
Based on the provided data, we can analyze the profitability ratios of Gates Industrial Corporation plc over the five-year period from 2020 to 2024 as follows:
1. Operating Return on Assets (Operating ROA):
- Gates Industrial Corporation plc's Operating ROA has exhibited an improving trend from 2.84% in 2020 to 7.05% in 2024.
- The Operating ROA indicates that the company generated $0.0284 of operating income for every $1 of assets in 2020, increasing to $0.0705 in 2024.
2. Return on Assets (ROA):
- The Return on Assets ratio shows a fluctuating pattern over the period, ranging from 1.07% in 2020 to 3.21% in 2023.
- This ratio reveals that Gates Industrial Corporation plc generated $0.0107 to $0.0321 of net income for every $1 in assets during the respective years.
3. Return on Total Capital:
- The Return on Total Capital has shown a generally increasing trend, climbing from 3.92% in 2020 to 8.97% in 2024.
- This metric indicates the company's ability to generate returns for both equity and debt providers on the total invested capital.
4. Return on Equity (ROE):
- Gates Industrial Corporation plc's Return on Equity ratio experienced fluctuations, peaking at 9.58% in 2021 before declining to 6.45% in 2024.
- The ROE reflects the company's profitability from the perspective of its shareholders, with the trend showing variations in returns over the years.
In conclusion, the profitability ratios of Gates Industrial Corporation plc demonstrate varying performance levels over the period, with improvements in Operating ROA and Return on Total Capital, while ROA and ROE experienced fluctuations. Further analysis and comparison with industry benchmarks may provide deeper insights into the company's financial performance and profitability.