Ironwood Pharmaceuticals Inc (IRWD)
Pretax margin
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before tax but after interest (EBT) | US$ in thousands | -918,749 | 252,465 | 200,648 | 108,861 | 21,505 |
| Revenue | US$ in thousands | 421,125 | 403,178 | 381,332 | 353,446 | 366,965 |
| Pretax margin | -218.17% | 62.62% | 52.62% | 30.80% | 5.86% |
December 31, 2023 calculation
Pretax margin = EBT ÷ Revenue
= $-918,749K ÷ $421,125K
= -218.17%
Ironwood Pharmaceuticals Inc's pretax margin has shown significant fluctuations over the past five years. In 2023, the company reported a negative pretax margin of -214.14%, which indicates that their operating expenses and cost of goods sold exceeded their total revenue, resulting in a substantial net loss before taxes.
This sharp decline from the previous year's pretax margin of 61.48% raises concerns about the company's profitability and operational efficiency. In 2022, Ironwood Pharmaceuticals had a healthy pretax margin of 61.48%, reflecting strong revenue generation relative to expenses.
In 2021 and 2020, the pretax margins were 48.50% and 27.95% respectively, showing consistent profitability and a positive trend in the company's financial performance. However, in 2019, the pretax margin was lower at 13.76%, indicating lower profitability compared to the following years.
The negative pretax margin in 2023 warrants further investigation into the factors contributing to the company's significant loss and the potential impact on its overall financial health and sustainability. Management may need to reassess their cost structure, revenue streams, and operational effectiveness to address this concerning trend and improve future performance.
Peer comparison
Dec 31, 2023