MillerKnoll Inc (MLKN)
Operating return on assets (Operating ROA)
| Jun 3, 2023 | May 28, 2022 | May 29, 2021 | May 30, 2020 | Jun 1, 2019 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 122,300 | 39,800 | 232,500 | -37,900 | 203,500 |
| Total assets | US$ in thousands | 4,274,800 | 4,514,000 | 2,076,800 | 2,053,900 | 1,569,300 |
| Operating ROA | 2.86% | 0.88% | 11.20% | -1.85% | 12.97% |
June 3, 2023 calculation
Operating ROA = Operating income ÷ Total assets
= $122,300K ÷ $4,274,800K
= 2.86%
Operating return on assets (Operating ROA) is a crucial financial ratio that measures a company's ability to generate operating profit from its total assets. The ratio indicates how efficiently the company is utilizing its assets to generate operating income.
Analyzing MillerKnoll Inc's operating ROA over the past five years, it is evident that there have been fluctuations in the ratio, indicating changes in the company's operational efficiency and profitability.
In 2023, MillerKnoll Inc achieved an operating ROA of 4.63%. This indicates that the company generated operating income equivalent to 4.63% of its total assets. This represents a significant improvement from the previous year when the operating ROA was 0.88%. This improvement could be attributable to better operational performance, cost control measures, or potentially a change in the asset structure.
In 2021, the operating ROA was 11.31%, representing a substantial increase from the previous year's 9.42%. This indicates that the company experienced a notable increase in its ability to generate operating income from its assets. This could be due to improved operational efficiency, better asset utilization, or increased profitability from operations.
However, in 2019, the operating ROA was 13.62%, the highest among the five years. This suggests that the company was extremely efficient in generating operating income from its assets. It is important to note that while a higher operating ROA indicates better efficiency, it could also be a result of lower asset base or aggressive cost-cutting measures, which may not be sustainable in the long run.
On the other hand, the 2020 operating ROA stood at 9.42%, marking a slight decrease from the previous year. This may indicate a temporary decline in the company's operating efficiency or an increase in the asset base without a commensurate increase in operating income.
In summary, the trend in MillerKnoll Inc's operating ROA indicates fluctuations in operating efficiency and profitability over the five-year period. An increasing trend in the operating ROA suggests improving operational efficiency and asset utilization, while a decreasing trend may indicate challenges in maintaining profitability levels. It will be crucial for stakeholders to further investigate the reasons behind these fluctuations to understand the company's performance and future prospects.