Newell Brands Inc (NWL)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 30.07% | 30.46% | 32.54% | 34.04% | 33.23% |
| Operating profit margin | -1.09% | 3.35% | 9.80% | -6.94% | -4.98% |
| Pretax margin | -6.94% | 1.69% | 7.35% | -11.05% | -9.61% |
| Net profit margin | -4.96% | 2.12% | 6.02% | -8.46% | 1.10% |
Newell Brands Inc's profitability ratios show a general declining trend over the past five years. The gross profit margin has decreased from 33.14% in 2019 to 28.93% in 2023, indicating a decrease in the percentage of revenue retained after accounting for the cost of goods sold. The operating profit margin has also shown a decreasing trend, dropping from 7.91% in 2019 to 4.33% in 2023, signifying a decline in the company's ability to generate profits from its core operations.
The pretax margin has been particularly volatile, with negative margins in 2020 and 2023. This indicates that Newell Brands Inc's expenses, including interest and taxes, have outweighed its gross profit, resulting in overall losses before taxes in those years. The net profit margin, which reflects the company's profitability after all expenses, also shows a decreasing trend, with negative margins in 2020 and 2023. This suggests that the company's profitability has been impacted by various expenses, leading to lower net income as a percentage of revenue.
Overall, the declining profitability ratios of Newell Brands Inc raise concerns about the company's ability to efficiently control costs, generate profits from its operations, and maintain sustainable financial performance over time.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | -0.70% | 2.35% | 7.10% | -4.28% | -3.08% |
| Return on assets (ROA) | -3.19% | 1.49% | 4.36% | -5.21% | 0.68% |
| Return on total capital | -3.38% | 4.74% | 11.24% | -8.06% | -6.07% |
| Return on equity (ROE) | -12.47% | 5.60% | 14.96% | -19.77% | 2.16% |
Newell Brands Inc's profitability ratios exhibit fluctuations over the past five years. In terms of Operating ROA, the company's performance has shown a declining trend from 7.21% in 2021 to 2.89% in 2023, indicating a decrease in operating efficiency in utilizing its assets to generate operating income.
Similarly, the overall ROA has been quite volatile, with a negative figure of -3.19% in 2023, implying that the company incurred a loss on its assets for that year. However, Newell Brands Inc managed to achieve positive ROA figures in the preceding years, reaching a peak of 4.03% in 2021.
The Return on Total Capital ratio reflects a similar pattern of fluctuations, with a downward trend observed from 11.38% in 2021 to 4.39% in 2023. This indicates a decrease in the company's ability to generate returns on the total capital employed in its operations.
The ROE, on the other hand, has been highly erratic, ranging from a low of -19.88% in 2020 to a high of 13.98% in 2021. The negative ROE figures in certain years suggest that Newell Brands Inc failed to generate positive returns for its shareholders during those periods.
Overall, the profitability ratios of Newell Brands Inc demonstrate mixed performance over the past five years, showcasing varying levels of operational efficiency, asset utilization, and shareholder return generation. Continued monitoring and strategic adjustments may be necessary to improve overall profitability in the future.