Spire Inc (SR)

Operating return on assets (Operating ROA)

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Operating income	US$ in thousands	418,600	408,200	450,200	206,400	302,300
Total assets	US$ in thousands	10,313,600	10,083,700	9,356,400	8,241,200	7,619,200
Operating ROA		4.06%	4.05%	4.81%	2.50%	3.97%

September 30, 2023 calculation

Operating ROA = Operating income ÷ Total assets
= $418,600K ÷ $10,313,600K
= 4.06%

Operating Return on Assets (Operating ROA) is a crucial financial metric that indicates a company's ability to generate profits from its assets used in its core operations. It is calculated by dividing operating income by average total assets. Spire Inc.'s operating ROA over the past five years has ranged from 3.97% to 4.81%, with the latest figure being 4.06% as of September 30, 2023.

The stability of Spire Inc.'s operating ROA over the years is notable, staying within a relatively narrow range. This indicates that the company has been consistently efficient in generating profits from its assets employed in its core business activities. Moreover, the fact that the operating ROA has remained above 4% for the past four years suggests that Spire Inc. has effectively utilized its assets to generate earnings from its operations, which is a positive sign for investors and stakeholders.

However, it is important to note that the slight decrease in operating ROA from 4.81% in 2021 to 4.06% in 2023 may warrant further investigation. While the current figure is still within a reasonable range, the decline over the past two years could indicate increased challenges in generating operating income relative to the average total assets. Analysts and investors may want to further examine the reasons behind this decline and assess whether it is a temporary fluctuation or a potential area of concern for the company's financial performance.

In conclusion, Spire Inc.'s consistent and relatively stable operating ROA suggests that the company has been effectively utilizing its assets to generate profits from its core operations. However, the recent decline in operating ROA warrants attention and ongoing monitoring to ensure continued efficiency in asset utilization and sustained profitability.