International Flavors & Fragrances Inc (IFF)
Return on assets (ROA)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | -2,567,000 | -1,871,000 | 270,000 | 363,228 | 455,873 |
| Total assets | US$ in thousands | 30,978,000 | 35,522,000 | 39,658,000 | 13,555,000 | 13,287,400 |
| ROA | -8.29% | -5.27% | 0.68% | 2.68% | 3.43% |
December 31, 2023 calculation
ROA = Net income ÷ Total assets
= $-2,567,000K ÷ $30,978,000K
= -8.29%
The return on assets (ROA) for International Flavors & Fragrances Inc. has shown a declining trend over the past five years. In 2019, the ROA was at its highest point at 3.41%, indicating that the company was generating a strong return on its assets. However, since then, the ROA has been decreasing annually, with negative values in the most recent years.
The significant drop in ROA from 2019 to 2020, from 3.41% to 2.69%, suggests a decrease in the company's ability to generate profits from its assets within a year. This trend continued in subsequent years, with ROA values of 0.68%, -5.28%, and -8.27% for 2021, 2022, and 2023, respectively.
The negative ROA values in the last three years are alarming as they indicate that the company's net income generated from its assets is insufficient to cover its expenses or that the assets are not being effectively utilized to generate profits. This could be a cause for concern for investors and stakeholders, as a negative ROA signifies potential inefficiencies or financial distress within the company.
In conclusion, the declining trend in International Flavors & Fragrances Inc.'s ROA over the past five years, especially the recent negative values, signals a decrease in the company's profitability in relation to its asset base. Further analysis and investigation into the company's operations and financial health are advisable to understand the underlying factors driving this decline in ROA.
Peer comparison
Dec 31, 2023