Neogen Corporation (NEOG)

Operating return on assets (Operating ROA)

		May 31, 2025	Feb 28, 2025	Nov 30, 2024	Aug 31, 2024	May 31, 2024	Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020
Operating income (ttm)	US$ in thousands	-1,060,997	-432,240	-425,632	46,317	63,195	69,048	45,238	23,117	10,044	-1,215	10,627	30,752	46,435	54,524	70,243	77,019	74,169	73,858	71,127	70,154
Total assets	US$ in thousands	3,443,840	4,036,340	4,054,090	4,503,170	4,584,160	4,582,490	4,602,420	4,561,100	4,554,430	4,508,760	4,563,240	977,405	992,929	979,898	966,680	932,106	920,192	880,216	845,626	821,592
Operating ROA		-30.81%	-10.71%	-10.50%	1.03%	1.38%	1.51%	0.98%	0.51%	0.22%	-0.03%	0.23%	3.15%	4.68%	5.56%	7.27%	8.26%	8.06%	8.39%	8.41%	8.54%

May 31, 2025 calculation

Operating ROA = Operating income (ttm) ÷ Total assets
= $-1,060,997K ÷ $3,443,840K
= -30.81%

The operating return on assets (ROA) of Neogen Corporation has exhibited notable fluctuations over the analyzed period. Initially, from August 31, 2020, through August 31, 2021, the company maintained relatively stable operating ROA figures, ranging between approximately 8.54% and 8.06%. During this period, the operating efficiency in generating returns from assets remained consistent and positive.

Subsequently, from November 30, 2021, onward, a sharp decline in operating ROA is observed. By February 28, 2022, the metric had decreased to approximately 5.56%, continuing a downward trend through May 31, 2022, when it fell further to around 4.68%. The decline persisted into August 2022, reaching approximately 3.15%, indicating diminishing efficiency in generating operating profits relative to asset base.

The downward trend intensified significantly thereafter, with negative values recorded starting November 30, 2022. The operating ROA decreased to approximately 0.23% at that date, turning negative by February 28, 2023, at roughly -0.03%. Although there was a marginal recovery to approximately 0.22% in May 2023 and 0.51% in August 2023, the metric remained near zero.

In the subsequent period, the operating ROA continued to deteriorate, ultimately reaching highly negative values by November 30, 2024, at approximately -10.50%, and further declining to about -10.71% by February 2025, and approximately -30.81% as of May 31, 2025. These figures indicate a substantial loss of operating efficiency, suggesting significant challenges in generating operating income relative to the asset base, possibly reflecting operational difficulties, asset impairments, or shifts in strategic focus.

Overall, the trend reveals a transition from a period of stable, positive operating ROA, indicative of effective asset utilization, to increasingly negative figures, highlighting deteriorating operational performance and diminishing asset efficiency over the recent period.