Kratos Defense & Security Solutions (KTOS)
Pretax margin
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before tax but after interest (EBT) | US$ in thousands | 26,500 | 11,100 | -32,700 | 4,400 | 6,800 |
| Revenue | US$ in thousands | 1,136,300 | 1,037,100 | 898,300 | 811,500 | 747,700 |
| Pretax margin | 2.33% | 1.07% | -3.64% | 0.54% | 0.91% |
December 31, 2024 calculation
Pretax margin = EBT ÷ Revenue
= $26,500K ÷ $1,136,300K
= 2.33%
The pretax margin of Kratos Defense & Security Solutions has exhibited notable fluctuations over the analyzed period from December 31, 2020, to December 31, 2024. In 2020, the company maintained a positive pretax margin of 0.91%, indicating a modest profit before taxes relative to revenues. This margin declined significantly in 2021 to 0.54%, reflecting a step down in profitability, potentially due to increased costs or lower revenue realizations.
The year 2022 marked a substantial downturn, with the pretax margin turning negative at -3.64%, suggesting the company incurred pretax losses during that period. This shift to a negative margin could have been driven by increased expenses, reduced revenue, or a combination of both, impacting overall profitability.
Subsequently, in 2023, the pretax margin rebounded to a positive level of 1.07%, indicating a recovery in profitability or improved operational efficiency. The upward trajectory continued into 2024, with the margin improving further to 2.33%. This progression suggests an overall strengthening of the company's pretax profitability, possibly driven by cost management strategies, revenue growth, or a favorable shift in operational conditions.
Overall, the pretax margin trend reflects periods of volatility, with a significant dip into negative territory in 2022 followed by a steady recovery in 2023 and 2024. The positive margins in the latter years indicate a return to profitable operations, although the margins remain relatively modest, which may warrant further investigation into underlying operational efficiencies and market conditions influencing the company's financial performance.