International Flavors & Fragrances Inc (IFF)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 33.46% | 34.25% | 32.86% | 42.15% | 42.26% |
| Operating profit margin | -19.18% | -10.94% | 5.15% | 11.44% | 13.30% |
| Pretax margin | -22.92% | -13.47% | 3.03% | 8.84% | 11.06% |
| Net profit margin | -23.33% | -15.44% | 2.38% | 7.34% | 9.12% |
International Flavors & Fragrances Inc. has experienced a declining trend in its profitability ratios over the past five years. The gross profit margin decreased from 41.10% in 2019 to 32.07% in 2023, indicating a decrease in profitability at the gross profit level.
The operating profit margin also declined significantly from 13.57% in 2019 to 5.04% in 2023, reflecting a decrease in the company's ability to generate profits from its core operations.
The pretax margin and net profit margin both show negative trends over the five-year period, with the company experiencing losses in profitability in recent years. The pretax margin was negative in 2021, 2022, and 2023, indicating that the company's expenses were higher than its revenues before taxes.
Overall, the declining trend in profitability ratios for International Flavors & Fragrances Inc. raises concerns about the company's ability to generate profits and manage its expenses effectively. Further analysis of the company's financial statements and operations is recommended to understand the underlying reasons behind these trends and to identify potential areas for improvement.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | -6.81% | -3.73% | 1.48% | 4.18% | 5.00% |
| Return on assets (ROA) | -8.29% | -5.27% | 0.68% | 2.68% | 3.43% |
| Return on total capital | -8.87% | -4.73% | 1.84% | 5.61% | 6.51% |
| Return on equity (ROE) | -17.57% | -10.60% | 1.28% | 5.76% | 7.33% |
International Flavors & Fragrances Inc.'s profitability ratios provide insights into its ability to generate profits relative to its assets, capital, and equity over the past five years.
- Operating return on assets (Operating ROA) has been fluctuating, with a significant decline in 2023 compared to previous years. This ratio indicates the company's ability to generate operating profit from its total assets and suggests a decrease in operational efficiency.
- Return on assets (ROA) shows a negative trend over the years, suggesting that the company's net income is not effectively generated from its total assets. The negative values indicate that IFF's assets are not being efficiently utilized to generate profits.
- Return on total capital has also experienced fluctuations, with a dip in 2023. This ratio measures the return earned on all the capital invested in the company, including debt and equity. The downward trend may indicate challenges in generating returns on the total capital employed.
- Return on equity (ROE) shows a consistent decline over the years, with negative values in recent years. ROE measures the return generated on shareholders' equity, and the negative trend suggests that the company's profitability in relation to shareholder investments has been deteriorating.
Overall, the declining trends in these profitability ratios indicate potential challenges in efficiently utilizing assets, capital, and equity to generate profits for International Flavors & Fragrances Inc. Further examination of the company's operations, financial structure, and strategic initiatives may be required to address the profitability issues identified by these ratios.