Gates Industrial Corporation plc (GTES)

Return on equity (ROE)

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Net income US$ in thousands 194,900 232,900 220,800 297,100 79,400
Total stockholders’ equity US$ in thousands 3,023,600 3,220,200 3,110,000 3,099,700 2,805,700
ROE 6.45% 7.23% 7.10% 9.58% 2.83%

December 31, 2024 calculation

ROE = Net income ÷ Total stockholders’ equity
= $194,900K ÷ $3,023,600K
= 6.45%

The return on equity (ROE) for Gates Industrial Corporation plc has shown variability over the past five years. Starting at 2.83% in December 31, 2020, the ROE increased to 9.58% by December 31, 2021, indicating a significant improvement in the company's ability to generate profits from shareholders' equity.

However, the ROE experienced a slight decline in the following years, with figures of 7.10% in December 31, 2022, 7.23% in December 31, 2023, and 6.45% in December 31, 2024. Although these values remained above the initial ROE in 2020, they suggest a trend of reduced profitability relative to the company's equity base.

Overall, Gates Industrial Corporation plc has demonstrated an increasing ROE in the short term, followed by some moderation in the subsequent years. It is crucial for the company to assess the factors driving these fluctuations and work towards maintaining a sustainable and competitive ROE in the future.