Magnolia Oil & Gas Corp (MGY)

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	461,840	495,509	900,475	426,133	-1,287,730
Revenue	US$ in thousands	1,315,890	1,226,980	1,694,490	1,078,350	541,303
Pretax margin		35.10%	40.38%	53.14%	39.52%	-237.89%

December 31, 2024 calculation

Pretax margin = EBT ÷ Revenue
= $461,840K ÷ $1,315,890K
= 35.10%

The pretax margin for Magnolia Oil & Gas Corp has shown significant fluctuations over the years. In particular, the company experienced a dramatic negative pretax margin of -237.89% as of December 31, 2020, indicating that the company's expenses exceeded its revenue before taxes. However, there has been a substantial improvement in performance since then, with the pretax margin increasing to 39.52% by December 31, 2021, and further rising to 53.14% by December 31, 2022. This upward trend demonstrates the company's ability to control costs and generate higher profits relative to revenue before tax.

Subsequently, there was a slight decrease in the pretax margin to 40.38% by December 31, 2023, followed by a further decline to 35.10% by December 31, 2024. While these decreases signify a reduction in profitability relative to revenue before tax, it is essential to analyze the underlying reasons for these fluctuations. Overall, the company experienced a mix of challenges and successes in managing its expenses and optimizing its revenue generation during this period.