Sally Beauty Holdings Inc (SBH)
Profitability ratios
Return on sales
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 50.91% | 51.97% | 51.79% | 51.71% | 50.23% |
| Operating profit margin | 7.61% | 8.90% | 9.11% | 11.08% | 7.58% |
| Pretax margin | 5.56% | 6.90% | 6.59% | 8.60% | 6.77% |
| Net profit margin | 4.13% | 5.05% | 4.95% | 6.35% | 5.40% |
Sally Beauty Holdings Inc's profitability ratios depict the company's ability to generate earnings relative to its revenue and operating costs over the past five years. The gross profit margin, which indicates the percentage of revenue retained after accounting for the cost of goods sold, has remained relatively stable, ranging from 50.23% in 2020 to 51.97% in 2023 before declining slightly to 50.91% in 2024.
Meanwhile, the operating profit margin, which reflects the portion of revenue remaining after deducting operating expenses, has displayed some variability. It decreased from 7.58% in 2020 to 7.61% in 2024, with a peak of 11.08% in 2021. This suggests fluctuations in the company's ability to control its operational costs and maintain profitability.
The pretax margin, representing the percentage of revenue remaining after accounting for all operating expenses and before taxes, has also fluctuated over the years. It ranged from 6.59% in 2022 to 8.60% in 2021, with a slight decrease to 5.56% in 2024.
Lastly, the net profit margin, which reflects the proportion of revenue that translates into net income after all expenses are deducted, has shown a downward trend from 5.40% in 2020 to 4.13% in 2024, with a peak of 6.35% in 2021. This indicates that the company's ability to generate profits relative to its revenue has decreased over the years.
Overall, while Sally Beauty Holdings Inc has maintained relatively stable gross profit margins, its operating, pretax, and net profit margins have shown some fluctuation and decline, suggesting potential challenges in cost management and efficiency in recent years.
Return on investment
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 10.12% | 11.93% | 13.10% | 14.70% | 8.94% |
| Return on assets (ROA) | 5.49% | 6.77% | 7.12% | 8.42% | 6.38% |
| Return on total capital | 17.27% | 20.71% | 25.36% | 24.44% | 17.82% |
| Return on equity (ROE) | 24.41% | 36.29% | 62.51% | 85.44% | 1,195.36% |
Sally Beauty Holdings Inc's profitability ratios depict a fluctuating trend over the past five years. The Operating Return on Assets (Operating ROA) has shown a gradual decline from 14.70% in 2021 to 10.12% in 2024. This indicates that the company's ability to generate profits from its assets has weakened slightly over the period.
Similarly, the Return on Assets (ROA) has also experienced a downward trend, dropping from 8.42% in 2021 to 5.49% in 2024. This suggests that the company's overall profitability in relation to its total assets has decreased over the years.
On the other hand, the Return on Total Capital has shown some fluctuations, peaking at 25.36% in 2022, but subsequently decreasing to 17.27% in 2024. This ratio signifies the company's ability to generate returns from both equity and debt capital employed in the business.
The most notable change is observed in the Return on Equity (ROE), which surged significantly from 85.44% in 2021 to an extraordinary 1,195.36% in 2020 and then dropped to 24.41% in 2024. Such fluctuations in ROE may be attributed to changes in the company's capital structure or extraordinary events impacting the equity base.
Overall, the analysis of Sally Beauty Holdings Inc's profitability ratios suggests a mixed performance, with some ratios showing declines or fluctuations over the years. It is essential for investors and stakeholders to delve deeper into the company's financial performance and operational strategies to understand the underlying factors driving these changes.