nVent Electric PLC (NVT)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 40.22% | 41.12% | 37.70% | 38.26% | 37.50% |
| Operating profit margin | 17.53% | 18.00% | 15.14% | 14.44% | 12.38% |
| Pretax margin | 14.28% | 15.31% | 16.25% | 13.03% | -0.48% |
| Net profit margin | 11.04% | 17.38% | 13.74% | 11.08% | -2.36% |
nVent Electric PLC has shown a consistent improvement in its gross profit margin over the years, starting at 37.50% in 2020 and gradually increasing to 40.22% in 2024. This indicates that the company has been able to effectively manage its cost of goods sold relative to its revenue, resulting in a higher percentage of revenue retained as gross profit.
Similarly, the operating profit margin has shown a positive trend, starting at 12.38% in 2020 and reaching 17.53% in 2024. This improvement suggests that nVent Electric PLC has been able to control its operating expenses efficiently, resulting in higher profitability from its core business operations.
The pretax margin also demonstrates a positive trajectory, with a notable increase from -0.48% in 2020 to 14.28% in 2024. This indicates the company's ability to generate higher profits before accounting for taxes, reflecting efficient financial management and operational performance.
However, there was a fluctuation in the net profit margin, with a peak at 17.38% in 2023 but dropping to 11.04% in 2024. This fluctuation may be attributed to various factors such as changes in operating expenses, taxes, or other non-operating items affecting the bottom line profitability of the company.
Overall, the improving trend in gross, operating, and pretax margins signifies nVent Electric PLC's ability to enhance efficiency and profitability in its operations, although it would be important for the company to address the decline in net profit margin in 2024 to ensure sustained overall profitability.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 7.83% | 9.53% | 8.98% | 7.60% | 5.67% |
| Return on assets (ROA) | 4.93% | 9.20% | 8.16% | 5.84% | -1.08% |
| Return on total capital | 16.53% | 18.69% | 18.44% | 15.07% | 11.13% |
| Return on equity (ROE) | 10.25% | 18.05% | 14.64% | 10.93% | -1.96% |
nVent Electric PLC's profitability ratios demonstrate an improving trend over the period from 2020 to 2024.
1. Operating Return on Assets (Operating ROA) has consistently increased from 5.67% in 2020 to 7.83% in 2024, indicating the company's ability to generate operating profits relative to its assets has improved.
2. Return on Assets (ROA) shows a mixed trend, starting at -1.08% in 2020, then increasing to 9.20% in 2023 before declining slightly to 4.93% in 2024. This ratio indicates the company's overall profitability in generating earnings from its total assets.
3. Return on Total Capital has shown a steady increase from 11.13% in 2020 to 16.53% in 2024, reflecting the efficiency of the company in generating returns from both equity and debt capital investments.
4. Return on Equity (ROE) has also demonstrated an upward trajectory, rising from -1.96% in 2020 to 10.25% in 2024, indicating an improvement in the company's ability to generate profits for its shareholders.
Overall, nVent Electric PLC's profitability ratios show positive momentum over the analyzed period, with increasing returns on assets, capital, and equity, reflecting improved operational performance and financial efficiency.