Treehouse Foods Inc (THS)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 16.35% | 16.79% | 15.84% | 16.76% | 18.44% |
| Operating profit margin | 3.07% | 4.28% | -0.38% | -1.57% | 3.43% |
| Pretax margin | 0.99% | 2.43% | 0.03% | -3.06% | 0.39% |
| Net profit margin | 0.80% | 1.55% | -4.44% | -0.44% | 0.32% |
Treehouse Foods Inc's profitability ratios have shown fluctuations over the past five years.
1. Gross Profit Margin: The gross profit margin has declined from 18.44% in 2020 to 16.35% in 2024. This indicates a decrease in the percentage of revenue retained after accounting for the cost of goods sold.
2. Operating Profit Margin: The operating profit margin has been volatile, with negative margins in 2021 and 2022, but showing improvement in 2023 and 2024. This suggests that the company has struggled with controlling operating expenses in the past.
3. Pretax Margin: The pretax margin fluctuated significantly, with a negative margin in 2021, but a positive trend in 2023 and 2024. This indicates that the company's profitability before accounting for taxes has been inconsistent.
4. Net Profit Margin: The net profit margin also exhibited variability, with negative margins in 2021 and 2022, but improvements in 2023 and 2024. This shows the company's ability to generate profits after all expenses, including taxes.
Overall, Treehouse Foods Inc needs to focus on improving its profitability ratios, particularly by enhancing cost management and operational efficiency to ensure sustainable growth in the future.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 2.59% | 3.58% | -0.30% | -0.85% | 2.72% |
| Return on assets (ROA) | 0.68% | 1.29% | -3.44% | -0.24% | 0.25% |
| Return on total capital | 6.23% | 9.50% | 4.21% | -0.76% | 6.54% |
| Return on equity (ROE) | 1.74% | 3.19% | -8.67% | -0.68% | 0.74% |
Treehouse Foods Inc's profitability ratios show mixed performance over the years.
- Operating return on assets (Operating ROA) improved from -0.85% in 2021 to 3.58% in 2023, indicating the company's ability to generate operating profits from its assets. However, it declined to -0.30% in 2022 before reaching 2.59% in 2024.
- Return on assets (ROA) was negative in 2021 and 2022 but turned positive in the following years, reaching 1.29% in 2023 and 0.68% in 2024. This indicates that the company started to generate a small profit from its total assets in the latter years.
- Return on total capital fluctuated, with the highest return of 9.50% in 2023 and the lowest of -0.76% in 2021. This ratio reflects the company's ability to generate profits from both equity and debt sources.
- Return on equity (ROE) was negative in 2021 and 2022 but became positive in the subsequent years, reaching 3.19% in 2023 and 1.74% in 2024. ROE represents the return generated for the shareholders' equity invested in the company.
Overall, while there are improvements in profitability ratios from the initially negative levels, Treehouse Foods Inc still faces challenges in consistently generating a satisfactory return on its assets, capital, and equity.