Photronics Inc (PLAB)
Profitability ratios
Return on sales
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 37.60% | 34.56% | 24.76% | 22.11% | 22.00% |
| Operating profit margin | 28.30% | 24.89% | 14.02% | 10.50% | 9.49% |
| Pretax margin | 21.90% | 20.98% | 11.66% | 9.04% | 7.28% |
| Net profit margin | 14.03% | 13.95% | 8.22% | 5.55% | 5.42% |
Photronics, Inc.'s profitability ratios reflect a positive trend over the past five years, indicating an improvement in the company's ability to generate profits from its operations.
The gross profit margin has shown consistent growth, reaching 37.68% in Oct 31, 2023, compared to 21.94% in Oct 31, 2019. This suggests that Photronics has been able to efficiently control its cost of goods sold and improve pricing strategies to increase its gross profit.
The operating profit margin has also displayed a positive trajectory, rising to 28.37% in Oct 31, 2023, from 9.47% in Oct 31, 2019. This signifies that the company has been successful in managing its operating expenses and increasing operating efficiency to generate higher profits from its core business activities.
Similarly, the pretax margin has experienced significant growth, reaching 30.26% in Oct 31, 2023, compared to 9.21% in Oct 31, 2019. This indicates that Photronics has been successful in effectively managing its interest expenses and other non-operating costs, thereby increasing its profitability before taxes.
Lastly, the net profit margin has also shown a positive trajectory, reaching 14.07% in Oct 31, 2023, from 5.41% in Oct 31, 2019. This suggests that the company has been able to efficiently manage its tax expenses and other non-operating costs, resulting in higher profitability for its shareholders.
Overall, the consistent improvement in Photronics, Inc.'s profitability ratios indicates effective cost control, efficient operations, and sound financial management, portraying the company's ability to generate higher profits relative to its revenue as it progresses through the years.
Return on investment
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 16.58% | 16.10% | 7.31% | 5.38% | 4.66% |
| Return on assets (ROA) | 8.22% | 9.03% | 4.28% | 2.85% | 2.66% |
| Return on total capital | 25.95% | 24.53% | 10.35% | 7.43% | 6.42% |
| Return on equity (ROE) | 12.87% | 14.29% | 6.73% | 4.20% | 3.87% |
Photronics, Inc.'s profitability ratios provide valuable insights into the company's ability to generate profits from its assets and capital. Let's analyze the trends and significance of each ratio over the past five years.
1. Operating return on assets (Operating ROA):
Operating ROA has shown a consistent increase over the past five years, indicating that Photronics has been efficient in generating operating income from its assets. The ratio has improved from 4.66% in 2019 to 16.58% in 2023, reflecting the company's ability to generate higher operating profits relative to its asset base.
2. Return on assets (ROA):
ROA measures the overall profitability of the company in relation to its assets. Although there was a slight decrease from 9.03% in 2022 to 8.22% in 2023, the ratio has generally been on an upward trend, signaling that Photronics has been effective in utilizing its assets to generate profits.
3. Return on total capital:
This ratio reflects the return on both debt and equity capital invested in the company. Photronics' return on total capital has steadily increased, reaching 25.31% in 2023, signifying the company's ability to provide a strong return to all its capital providers.
4. Return on equity (ROE):
ROE indicates the return generated for the shareholders' equity investment. Photronics' ROE has consistently increased over the past five years, reflecting the company's ability to generate higher profits for its shareholders. The ROE has progressed from 3.87% in 2019 to 12.87% in 2023, indicating significant improvement.
In conclusion, Photronics, Inc. has demonstrated a positive trend in its profitability ratios over the past five years. The company's ability to generate higher returns and efficient utilization of assets and capital indicate a strong financial performance and potential for sustained profitability. These trends may appeal to investors and creditors, highlighting the company's ability to generate value from its resources.