Reliance Steel & Aluminum Co (RS)
Operating return on assets (Operating ROA)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 1,160,000 | 1,739,500 | 2,506,900 | 1,948,900 | 565,800 |
| Total assets | US$ in thousands | 10,021,800 | 10,480,300 | 10,329,900 | 9,536,000 | 8,106,800 |
| Operating ROA | 11.57% | 16.60% | 24.27% | 20.44% | 6.98% |
December 31, 2024 calculation
Operating ROA = Operating income ÷ Total assets
= $1,160,000K ÷ $10,021,800K
= 11.57%
Reliance Steel & Aluminum Co's operating return on assets (operating ROA) has shown a positive trend over the past five years, indicating improving operational efficiency and profitability. The company's operating ROA increased from 6.98% in December 2020 to 20.44% in December 2021, demonstrating a significant improvement. This upward trajectory continued in the following years, with operating ROA reaching 24.27% in December 2022, showcasing the company's ability to generate strong returns from its assets.
However, there was a slight decline in operating ROA in December 2023 to 16.60%, which may be attributed to various factors such as changes in operating expenses or asset base. Despite this dip, the operating ROA remained above the initial level recorded in 2020, indicating that Reliance Steel & Aluminum Co continued to effectively utilize its assets to generate profits.
In December 2024, the operating ROA decreased further to 11.57%, suggesting a potential challenge in maintaining the same level of profitability seen in the previous years. It would be essential for the company to assess its operational strategies and asset utilization to ensure sustainable and profitable growth in the future.