Neogen Corporation (NEOG)

Pretax margin

		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
Earnings before tax but after interest (EBT) (ttm)	US$ in thousands	-1,092,044	-508,307	-504,402	-31,577	-14,305	-256	3,306	-27,038	-22,042	-10,783	-1,880	45,139	60,207	61,444	70,778	77,185	75,268	76,299	74,572	74,463
Revenue (ttm)	US$ in thousands	894,661	905,996	913,828	912,199	924,222	929,238	918,681	919,085	822,447	720,730	630,719	531,203	527,159	514,491	502,956	487,439	468,459	450,108	433,268	426,071
Pretax margin		-122.06%	-56.10%	-55.20%	-3.46%	-1.55%	-0.03%	0.36%	-2.94%	-2.68%	-1.50%	-0.30%	8.50%	11.42%	11.94%	14.07%	15.83%	16.07%	16.95%	17.21%	17.48%

May 31, 2025 calculation

Pretax margin = EBT (ttm) ÷ Revenue (ttm)
= $-1,092,044K ÷ $894,661K
= -122.06%

The pretax margin of Neogen Corporation demonstrates a notable decline over the observed period from August 31, 2020, through May 31, 2025. Initially, the company maintained a relatively high pretax margin, with values around 17.5% in August 2020, gradually decreasing over the subsequent periods. By November 30, 2021, the margin had diminished significantly from its peak, reaching approximately 14.07%. The downward trend persisted into 2022, with the margin falling to approximately 8.50% in August 2022, and entering negative territory by November 2022 at -0.30%. This indicates that, at that point, the company's operations were no longer generating pre-tax profits, but rather losses. The negative margin continued through early 2023, with the deficit deepening to approximately -2.94% by August 2023.

In the subsequent periods, volatility was observed with the pretax margin briefly returning to marginally positive at 0.36% in November 2023. However, this recovery was short-lived, as the negative trend resumed, and the margin again declined into deeper losses, reaching approximately -3.46% by August 2024. The most recent data reveals a sharp deterioration in profitability, with the pretax margin dropping dramatically to -55.20% in November 2024, and further deepening to approximately -122.06% in May 2025. This indicates that the company has experienced extraordinary losses in the later periods, reflected in a contraction well beyond the break-even point, suggesting profound operational or extraordinary expense issues impacting profitability markedly in recent periods.

Overall, the trend exhibits a consistent decline in pretax margin over time, evolving from positive profitability levels into increasingly severe losses, culminating in an extraordinary negative margin in the latest reported periods. This reflects significant challenges faced by the company, which could be attributed to operational, market, or other financial difficulties impacting profitability.