Neogen Corporation (NEOG)

Operating profit margin

		May 31, 2024	May 31, 2023	May 31, 2022	May 31, 2021	May 31, 2020
Operating income	US$ in thousands	58,663	37,515	34,924	53,128	49,127
Revenue	US$ in thousands	924,222	822,447	527,159	468,459	418,170
Operating profit margin		6.35%	4.56%	6.62%	11.34%	11.75%

May 31, 2024 calculation

Operating profit margin = Operating income ÷ Revenue
= $58,663K ÷ $924,222K
= 6.35%

Neogen Corporation's operating profit margin has experienced fluctuations over the past five years. Starting at 11.75% on May 31, 2020, it slightly decreased to 11.34% by May 31, 2021. However, in the subsequent years, there was a significant decline in the operating profit margin to 6.62% on May 31, 2022, and further dropped to 4.56% by May 31, 2023. By May 31, 2024, there was a slight recovery in the operating profit margin to 6.35%.

The decreasing trend in the operating profit margin from 2021 to 2023 indicates potential challenges Neogen Corporation may have faced in managing its operating expenses relative to its revenue during this period. The slight rebound in 2024 suggests some improvement in controlling costs or potentially increased revenue generation efforts.

It is crucial for Neogen Corporation to analyze the reasons behind these fluctuations in the operating profit margin to identify areas for operational improvement. Monitoring and managing operating expenses efficiently while maximizing revenue streams will be key in enhancing profitability and overall financial performance in the future.