Quaker Chemical Corporation (KWR)
Operating return on assets (Operating ROA)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 194,706 | 214,495 | 52,304 | 150,466 | 59,360 |
| Total assets | US$ in thousands | 2,610,650 | 2,714,210 | 2,821,620 | 2,955,760 | 2,891,830 |
| Operating ROA | 7.46% | 7.90% | 1.85% | 5.09% | 2.05% |
December 31, 2024 calculation
Operating ROA = Operating income ÷ Total assets
= $194,706K ÷ $2,610,650K
= 7.46%
Operating Return on Assets (Operating ROA) is a key financial ratio that measures a company's ability to generate profit from its operational assets. Analyzing Quaker Chemical Corporation's Operating ROA over the past five years, we observe varying trends:
1. As of December 31, 2020, Quaker Chemical Corporation had an Operating ROA of 2.05%, indicating that the company generated $0.0205 in operating income for every dollar of assets it owned.
2. By December 31, 2021, the Operating ROA improved significantly to 5.09%, demonstrating enhanced efficiency in utilizing its assets to generate operating profit.
3. However, in the following year, by December 31, 2022, the Operating ROA decreased to 1.85%, suggesting a decline in the company's operational performance in relation to its asset base.
4. The trend reversed in the subsequent years, with Quaker Chemical Corporation's Operating ROA showing strong improvement. By December 31, 2023, the Operating ROA surged to 7.90%, indicating heightened efficiency and profitability from its operational assets.
5. As of the latest data available, December 31, 2024, the Operating ROA maintained a robust level of 7.46%, highlighting Quaker Chemical Corporation's continued focus on maximizing returns from its operational activities.
In conclusion, Quaker Chemical Corporation's Operating ROA experienced fluctuations over the past five years, with notable improvements in 2021 and 2023. The company's ability to efficiently utilize its assets to drive operational profitability is crucial for sustainable growth and value creation for its stakeholders. It is important for the company to consistently monitor and optimize its asset utilization to maintain and enhance its operating performance in the future.
Peer comparison
Dec 31, 2024