Kellanova (K)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 35.65% | 100.00% | 30.12% | 32.50% | 34.33% |
| Operating profit margin | 14.69% | 11.47% | 9.57% | 11.77% | 12.79% |
| Pretax margin | 12.97% | 7.93% | 7.13% | 12.36% | 11.63% |
| Net profit margin | 10.53% | 7.25% | 7.59% | 12.67% | 9.08% |
Based on the provided data, I analyzed Kellanova's profitability ratios over the five-year period from December 31, 2020, to December 31, 2024.
1. Gross Profit Margin:
- The gross profit margin indicates the percentage of revenue that exceeds the cost of goods sold. Kellanova's gross profit margin declined from 34.33% in 2020 to 30.12% in 2022 before significantly increasing to 100.00% in 2023 and leveling off at 35.65% in 2024.
2. Operating Profit Margin:
- The operating profit margin reflects the efficiency of the company in managing its operating expenses. Kellanova's operating profit margin decreased from 12.79% in 2020 to 9.57% in 2022, then slightly improved to 11.47% in 2023, and rose notably to 14.69% in 2024.
3. Pretax Margin:
- The pretax margin reveals the percentage of each dollar of revenue that translates to pre-tax profit. Kellanova's pretax margin fluctuated over the years, starting at 11.63% in 2020, increasing to 12.36% in 2021, dropping to 7.13% in 2022, and then slightly improving to 7.93% in 2023 and 12.97% in 2024.
4. Net Profit Margin:
- The net profit margin shows the portion of revenue remaining after all expenses have been deducted. Kellanova's net profit margin varied from 9.08% in 2020 to 7.59% in 2022 and 7.25% in 2023 before rebounding to 10.53% in 2024.
Overall, despite fluctuations, Kellanova managed to improve its profitability ratios towards the end of the period, with notable increases in operating profit margin and net profit margin in 2024. The significant spike in gross profit margin in 2023 may warrant further investigation to understand the underlying reasons for such an anomaly.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 11.98% | 9.63% | 6.55% | 7.61% | 9.79% |
| Return on assets (ROA) | 8.59% | 6.09% | 5.19% | 8.19% | 6.95% |
| Return on total capital | 52.05% | 47.40% | 27.99% | 44.54% | 60.48% |
| Return on equity (ROE) | 35.58% | 29.95% | 24.36% | 40.00% | 40.20% |
Kellanova's profitability ratios indicate fluctuations in its financial performance over the years.
- Operating return on assets (Operating ROA) has shown a declining trend from 9.79% in 2020 to 6.55% in 2022, followed by an increase to 11.98% in 2024. This ratio measures the company's operating income generated per dollar of assets, with higher values indicating efficient asset utilization.
- Return on assets (ROA) experienced variability, with a peak of 8.59% in 2024. ROA reflects the company's overall ability to generate profits from its assets, showing how efficient the company is at utilizing its assets to generate earnings.
- Return on total capital exhibited a decrease from 60.48% in 2020 to 27.99% in 2022, before rebounding to 52.05% in 2024. This ratio provides insight into how effectively the company is utilizing its total capital to generate profits.
- Return on equity (ROE) declined from 40.20% in 2020 to 24.36% in 2022, before showing a slight improvement to 35.58% in 2024. ROE reflects the profitability of the company from the perspective of its equity shareholders, indicating how well the company is using shareholder funds to generate returns.
Overall, Kellanova's profitability ratios demonstrate a mixed performance over the years, with fluctuations in efficiency in generating profits from assets, capital, and equity. Additional analysis and contextual information would be needed to fully understand the factors driving these changes in the ratios.