Sylvamo Corp (SLVM)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|
| Gross profit margin | 14.02% | 17.11% | 28.17% |
| Operating profit margin | 4.23% | 7.95% | 20.95% |
| Pretax margin | 10.01% | 7.00% | 12.33% |
| Net profit margin | 6.86% | 3.32% | 9.45% |
Sylvamo Corp's profitability ratios reflect its ability to generate profits relative to its revenue and operating expenses over the past four years.
1. Gross Profit Margin: The gross profit margin measures the percentage of revenue that exceeds the cost of goods sold. Sylvamo's gross profit margin has decreased from 34.38% in 2021 to 24.51% in 2023, indicating a decline in the efficiency of production and higher production costs.
2. Operating Profit Margin: The operating profit margin reflects the company's ability to control operating expenses relative to revenue. Sylvamo's operating profit margin has fluctuated over the years, reaching its peak at 14.77% in 2022 and then declining to 12.07% in 2023. This suggests that the company may be facing challenges in managing and reducing its operating costs.
3. Pretax Margin: The pretax margin indicates the percentage of revenue that remains after deducting all operating expenses but before taxes. Sylvamo's pretax margin has shown variability, with the highest margin of 13.14% in 2021 and the lowest margin of 6.58% in 2020. This indicates fluctuations in the company's operational efficiency and cost control measures.
4. Net Profit Margin: The net profit margin measures the company's profitability after accounting for all expenses, including taxes. Sylvamo's net profit margin has also been inconsistent, with a high of 9.45% in 2021 and a low of 3.25% in 2022. The net profit margin for 2023 stands at 6.80%, indicating a moderate increase in profitability compared to the previous year.
Overall, Sylvamo Corp's profitability ratios highlight areas where the company may need to focus on improving operational efficiency, cost management, and revenue generation to sustain and enhance its profitability in the future.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|
| Operating return on assets (Operating ROA) | 5.43% | 10.44% | 28.26% |
| Return on assets (ROA) | 8.81% | 4.35% | 12.75% |
| Return on total capital | 48.06% | 48.53% | 254.95% |
| Return on equity (ROE) | 28.08% | 17.40% | 181.87% |
Sylvamo Corp's profitability ratios indicate a mixed performance over the past four years.
The Operating Return on Assets (Operating ROA) decreased from 19.78% in 2022 to 15.63% in 2023, indicating a decline in the company's ability to generate operating profits from its total assets. However, the 2023 Operating ROA is still higher than that of 2021 and 2020, suggesting operational efficiency improvement over the years.
Return on Assets (ROA) reflects the company's overall profitability in relation to its total assets. Sylvamo Corp's ROA fluctuated significantly over the period, peaking at 12.75% in 2021 and hitting a low of 4.35% in 2022. The 2023 ROA of 8.81% is an improvement compared to the previous year, indicating better asset utilization to generate profits.
Return on Total Capital measures the return generated by the company on all capital invested in the business. Sylvamo Corp's Return on Total Capital was highest in 2022 at 31.35%, dipped to 24.14% in 2023. The decreasing trend from 2022 to 2023 may suggest a lower return relative to the total capital invested in the business in that year.
Return on Equity (ROE) indicates the return on shareholder's equity. Sylvamo Corp's ROE saw fluctuations, with the highest at 181.87% in 2021 and the lowest at 8.05% in 2020. The 2023 ROE of 28.08% represents a strong return on equity compared to the previous years and indicates an improvement in the company's ability to generate profits from shareholder investments.
In summary, while Sylvamo Corp's profitability ratios show some variability over the years, the company has demonstrated a generally positive trend in profitability and efficiency in converting assets and equity into profits, with 2023 showing improvements in some key metrics.