Sonoco Products Company (SON)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 21.47% | 21.25% | 19.86% | 19.00% | 19.98% |
| Operating profit margin | 6.16% | 10.56% | 9.32% | -1.16% | 9.31% |
| Pretax margin | 1.20% | 9.07% | 7.88% | -2.88% | 4.88% |
| Net profit margin | 3.09% | 7.00% | 6.43% | -1.67% | 3.96% |
Sonoco Products Company's gross profit margin has shown fluctuations over the past five years, ranging from a low of 19.00% in 2021 to a high of 21.47% in 2024. This indicates the company's ability to efficiently manage production costs and pricing strategies.
The operating profit margin, which reflects the company's ability to generate profits from its core operations, has been erratic. While it dipped into negative territory in 2021, it recovered in subsequent years, with a peak of 10.56% in 2023.
Similarly, the pretax margin, representing the proportion of income before taxes relative to total revenue, is quite variable. It reached a low of -2.88% in 2021 but rebounded to 9.07% in 2023 before declining in 2024.
The net profit margin, indicating the percentage of revenue that translates into net income, experienced a notable decline in 2021, falling into negative territory. Despite some recovery in the following years, the margin remained lower than the levels seen in 2020 and 2023.
Overall, Sonoco Products Company's profitability ratios demonstrate a mixed performance over the past five years, with varying levels of profitability and efficiency in managing costs and generating income from operations.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 2.61% | 9.95% | 9.53% | -1.27% | 9.24% |
| Return on assets (ROA) | 1.31% | 6.60% | 6.58% | -1.84% | 3.93% |
| Return on total capital | 10.39% | 31.00% | 38.11% | -5.24% | 17.31% |
| Return on equity (ROE) | 7.22% | 19.59% | 22.50% | -5.06% | 10.86% |
Sonoco Products Company's profitability ratios show fluctuations over the years.
1. Operating Return on Assets (Operating ROA):
- In 2020, the Operating ROA was 9.24%, indicating a decent return on assets generated through operations.
- In 2021, the Operating ROA turned negative at -1.27%, suggesting operational inefficiencies leading to operational losses.
- By 2022, the Operating ROA increased to 9.53%, reflecting improved operational performance.
- The trend continued in 2023 with a further increase to 9.95%, indicating continued efficiency in generating operating profits.
- However, in 2024, the Operating ROA decreased to 2.61%, potentially signaling operational challenges impacting profitability.
2. Return on Assets (ROA):
- The ROA in 2020 was 3.93%, showing a moderate return on assets.
- In 2021, the ROA turned negative at -1.84%, indicating a net loss relative to the assets employed.
- By 2022, the ROA improved to 6.58%, suggesting a recovery in asset utilization efficiency.
- The ROA remained relatively stable in 2023 at 6.60%.
- In 2024, the ROA decreased to 1.31%, indicating a lower return on assets relative to previous years.
3. Return on Total Capital:
- Sonoco Products Company had a high Return on Total Capital of 17.31% in 2020, indicating effective utilization of total capital.
- However, in 2021, the Return on Total Capital turned negative at -5.24%, indicating capital inefficiencies leading to losses.
- By 2022, there was a significant improvement with a Return on Total Capital of 38.11%, reflecting efficient capital allocation.
- In 2023, the Return on Total Capital decreased slightly to 31.00% but remained at a relatively high level.
- By 2024, the Return on Total Capital decreased further to 10.39%, potentially indicating challenges in maintaining high capital efficiency.
4. Return on Equity (ROE):
- The ROE in 2020 was 10.86%, showing a decent return to equity shareholders.
- In 2021, the ROE turned negative at -5.06%, indicating a loss to equity investors.
- By 2022, the ROE improved to 22.50%, reflecting a strong return on equity.
- In 2023, the ROE slightly decreased to 19.59% but remained at a healthy level.
- However, in 2024, the ROE further decreased to 7.22%, potentially indicating challenges in generating returns for equity holders.
Overall, Sonoco Products Company's profitability ratios demonstrate varying trends over the years, with fluctuations in operational efficiency, asset utilization, capital allocation, and returns to equity shareholders.