Organon & Co (OGN)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 58.02% | 59.84% | 62.84% | 62.21% | 58.66% |
| Operating profit margin | 23.21% | 21.19% | 23.94% | 25.68% | 35.19% |
| Pretax margin | 12.60% | 10.75% | 18.17% | 24.25% | 33.10% |
| Net profit margin | 13.49% | 16.33% | 14.85% | 21.43% | 26.68% |
Organon & Co's profitability ratios have shown some fluctuations over the years. The gross profit margin has generally been trending upwards, increasing from 58.66% in 2020 to 62.84% in 2022, before experiencing a slight decline to 58.02% in 2024. This indicates the company's ability to efficiently manage its production costs and generate profit from its core business activities.
On the other hand, the operating profit margin has been more volatile, decreasing from 35.19% in 2020 to 21.19% in 2023 before rebounding to 23.21% in 2024. This suggests fluctuations in the company's operating expenses and efficiency in generating profit from its operations.
The pretax margin followed a similar downward trend, declining from 33.10% in 2020 to 10.75% in 2023, before improving slightly to 12.60% in 2024. This indicates the impact of factors such as taxes and non-operating expenses on the company's profitability.
Lastly, the net profit margin has also shown a declining trend, decreasing from 26.68% in 2020 to 13.49% in 2024. This metric reflects the company's overall profitability after accounting for all expenses, including taxes and interest.
In conclusion, while Organon & Co has demonstrated strong gross profit margins, its operating, pretax, and net profit margins have shown some fluctuations and a general downward trend over the years. This analysis suggests that the company may need to focus on improving its cost management and operational efficiency to enhance its overall profitability in the future.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 11.34% | 11.01% | 13.49% | 15.16% | 27.30% |
| Return on assets (ROA) | 6.59% | 8.48% | 8.37% | 12.65% | 20.70% |
| Return on total capital | 281.14% | — | — | — | — |
| Return on equity (ROE) | 183.05% | — | — | — | — |
Organon & Co's profitability ratios show fluctuations over the years. Starting with the Operating Return on Assets (Operating ROA), the company's performance peaked at 27.30% on December 31, 2020, but gradually decreased to 15.16% in 2021, further declining to 13.49% by the end of 2022, and to 11.01% by the end of 2023. There was a slight increase to 11.34% by December 31, 2024, indicating a mixed performance in generating profits from its assets.
In terms of Return on Assets (ROA), Organon & Co achieved a high of 20.70% in 2020, but this metric also declined over the subsequent years to 12.65% in 2021, 8.37% in 2022, and 8.48% in 2023, before hitting 6.59% by the end of 2024. This demonstrates a decreasing trend in the company's ability to generate profit relative to its total assets.
Interestingly, there is no data provided for Return on Total Capital and Return on Equity (ROE) for the years 2020 to 2023, but as of December 31, 2024, the Return on Total Capital was remarkably high at 281.14%, while the Return on Equity stood at 183.05%. This suggests that the company delivered exceptionally strong returns to its total capital and equity holders in 2024.
In conclusion, Organon & Co's profitability ratios illustrate a mix of performance trends, including fluctuations in operating profitability and declining return on assets in recent years, alongside exceptional returns on total capital and equity in the most recent period. It would be important for the company to monitor these ratios closely to ensure sustainable profitability and efficient asset utilization in the future.