nVent Electric PLC (NVT)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 42.00% | 38.11% | 39.01% | 38.19% | 40.10% |
| Operating profit margin | 18.38% | 15.30% | 14.72% | 1.96% | 15.43% |
| Pretax margin | 15.63% | 16.42% | 13.28% | -0.48% | 11.92% |
| Net profit margin | 17.75% | 13.89% | 11.30% | -2.41% | 10.31% |
nVent Electric plc has demonstrated improving profitability over the last five years based on key profitability ratios.
1. Gross Profit Margin: The company's gross profit margin has shown a general upward trend from 2019 to 2023, indicating efficient cost management and a healthy pricing strategy. The 2023 gross profit margin of 41.12% reflects the company's ability to generate profits after accounting for the cost of goods sold.
2. Operating Profit Margin: nVent Electric plc has also shown a consistent increase in its operating profit margin over the same period. The 2023 operating profit margin of 18.00% suggests that the company has been effectively managing its operating expenses while generating profit from its core business activities.
3. Pretax Margin: The pretax margin reflects nVent Electric plc's ability to generate profit before accounting for taxes. While there was a significant improvement in 2023 from a negative pretax margin in 2020, the company has generally maintained positive pretax margins over the analyzed period, with 2023 standing at 15.31%.
4. Net Profit Margin: The net profit margin measures the company's overall profitability after all expenses, including taxes. nVent Electric plc's net profit margin has shown a strong improvement in 2023, reaching 17.38%. This indicates that the company has effectively controlled its costs and expenses to increase its bottom line profitability.
Overall, nVent Electric plc's profitability ratios suggest that the company has been successful in maintaining and improving its profitability over the past five years through effective cost management and operational efficiency.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 9.53% | 8.98% | 7.60% | 0.88% | 7.18% |
| Return on assets (ROA) | 9.20% | 8.16% | 5.84% | -1.08% | 4.80% |
| Return on total capital | 11.84% | 13.26% | 10.11% | 0.81% | 8.30% |
| Return on equity (ROE) | 18.05% | 14.64% | 10.93% | -1.96% | 8.59% |
nVent Electric plc has demonstrated consistent improvement in its profitability ratios over the past five years.
The Operating return on assets (Operating ROA) has shown an increasing trend, indicating that the company is becoming more efficient in generating profits from its assets. This ratio increased from 7.18% in 2019 to 9.53% in 2023.
Return on assets (ROA) also shows an upward trend, reflecting the company's ability to generate profits relative to its total assets. The significant improvement in ROA from -1.08% in 2020 to 9.20% in 2023 is a positive sign of the company's improved asset utilization and profitability.
Return on total capital has also shown a consistent increase over the years, indicating that the company is effectively generating returns on its total capital employed. This ratio increased from 9.11% in 2019 to 11.93% in 2023.
Return on equity (ROE) has demonstrated strong growth over the years, indicating an improvement in the company's profitability from the perspective of its equity holders. The ROE increased from 8.59% in 2019 to 18.05% in 2023, showing that the company is effectively leveraging its equity to generate returns for its shareholders.
Overall, the profitability ratios of nVent Electric plc indicate a positive trend in the company's performance and efficiency in utilizing its assets and capital to generate profits for its shareholders.