Sonoco Products Company (SON)
Operating return on assets (Operating ROA)
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating income (ttm) | US$ in thousands | 507,837 | 590,964 | 625,769 | 634,080 | 672,803 | 660,508 | 679,513 | 718,954 | 705,221 | 683,044 | 627,614 | 535,605 | 486,853 | 399,342 | 379,574 | 348,010 | 357,804 | 422,452 | 454,256 | 480,297 |
| Total assets | US$ in thousands | 12,507,800 | 9,042,860 | 7,154,660 | 7,198,280 | 7,191,960 | 7,270,000 | 7,048,990 | 7,061,430 | 7,089,910 | 6,975,650 | 6,989,510 | 6,955,990 | 5,085,330 | 4,925,150 | 4,994,040 | 5,280,750 | 5,277,260 | 5,767,230 | 5,738,860 | 5,012,140 |
| Operating ROA | 4.06% | 6.54% | 8.75% | 8.81% | 9.35% | 9.09% | 9.64% | 10.18% | 9.95% | 9.79% | 8.98% | 7.70% | 9.57% | 8.11% | 7.60% | 6.59% | 6.78% | 7.33% | 7.92% | 9.58% |
December 31, 2024 calculation
Operating ROA = Operating income (ttm) ÷ Total assets
= $507,837K ÷ $12,507,800K
= 4.06%
Operating return on assets (ROA) is a key financial metric that indicates how efficiently a company is generating profits from its assets used in operations. The analysis of operating ROA for Sonoco Products Company reveals fluctuations in the company's ability to generate earnings relative to its assets over the specified time period.
From March 31, 2020, to December 31, 2024, Sonoco Products Company's operating ROA exhibited a general declining trend with some notable fluctuations. The operating ROA started at 9.58% in March 2020, indicating that the company generated $0.0958 in operating income for every dollar of assets employed.
The ratio declined steadily to a low of 4.06% by December 31, 2024. This significant drop in operating ROA suggests that the company's ability to generate operating profits from its assets deteriorated over the period.
Throughout the analyzed period, Sonoco Products Company's operating ROA experienced both ups and downs, with occasional spikes and dips. However, the overall decreasing trend indicates that the company may be facing challenges in effectively utilizing its assets to generate operating income.
It is crucial for the company's management to investigate the reasons behind the declining operating ROA and take necessary actions to improve asset efficiency and profitability. This may involve optimizing asset utilization, controlling operating costs, enhancing revenue generation, or reconsidering the asset structure to enhance overall performance and return on assets.
Peer comparison
Dec 31, 2024