Louisiana-Pacific Corporation (LPX)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 22.98% | 38.87% | 50.14% | 34.72% | 13.12% |
| Operating profit margin | 11.12% | 32.43% | 44.29% | 25.64% | -0.87% |
| Pretax margin | 9.76% | 35.29% | 45.44% | 25.84% | -0.78% |
| Net profit margin | 6.90% | 28.18% | 35.17% | 20.80% | -0.22% |
Louisiana-Pacific Corp.'s profitability ratios show fluctuating trends over the past five years. The gross profit margin has been on a decreasing trend from 45.49% in 2021 to 22.98% in 2023, indicating a decrease in the percentage of revenue retained after accounting for the cost of goods sold.
Similarly, the operating profit margin has also decreased over the years, from 40.19% in 2021 to 13.02% in 2023. This suggests that the company's operating expenses relative to revenue have increased, impacting its operating profitability.
The pretax margin has followed a similar pattern, declining from 39.51% in 2021 to 9.76% in 2023. This indicates that there has been a decrease in the percentage of revenue remaining after accounting for operating expenses and interest expenses but before taxes.
The net profit margin, which represents the company's bottom line profitability, has also shown a downward trend, decreasing from 30.24% in 2021 to 6.90% in 2023. This indicates that the company's overall profitability has decreased over the years after accounting for all expenses, including taxes.
In summary, Louisiana-Pacific Corp.'s profitability ratios have exhibited a declining trend over the past five years, reflecting challenges in managing costs and maintaining profitability levels. It would be important for the company to assess its cost structure and operational efficiency to improve its profitability margins in the future.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 11.78% | 53.19% | 79.03% | 29.48% | -1.09% |
| Return on assets (ROA) | 7.30% | 46.21% | 62.76% | 23.92% | -0.27% |
| Return on total capital | 14.13% | 77.23% | 113.47% | 40.27% | -1.49% |
| Return on equity (ROE) | 11.43% | 75.79% | 111.50% | 40.44% | -0.50% |
Louisiana-Pacific Corp. has shown a fluctuating trend in profitability ratios over the past five years. The Operating Return on Assets (Operating ROA) has varied significantly, ranging from 3.98% in 2019 to 83.33% in 2021. This ratio indicates the company's ability to generate profits from its assets before interest and taxes.
The Return on Assets (ROA) also demonstrates volatility, with a low of -0.27% in 2019 and a high of 62.70% in 2021. ROA measures how efficiently the company is utilizing its assets to generate profits.
The Return on Total Capital has displayed a similar pattern of variability, ranging from 5.45% in 2019 to 116.00% in 2021. This ratio shows the overall profitability of the company relative to its total capital employed.
On the other hand, the Return on Equity (ROE) has experienced fluctuations as well, with values ranging from -0.50% in 2019 to 111.50% in 2021. ROE reflects the return generated for the company's shareholders based on their equity investment.
It is evident that Louisiana-Pacific Corp. has seen significant changes in its profitability ratios over the years, which may be attributed to fluctuations in operational efficiency, asset utilization, capital structure, and overall financial performance. Further analysis and evaluation would be required to understand the underlying factors driving these fluctuations and their implications for the company's financial health.