Travel + Leisure Co (TNL)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 54.88% | 54.84% | 59.09% | 22.31% | 95.40% |
| Operating profit margin | 19.20% | 18.31% | 19.72% | -4.86% | 20.08% |
| Pretax margin | 13.07% | 13.65% | 13.53% | -12.87% | 17.26% |
| Net profit margin | 10.56% | 10.01% | 9.83% | -11.81% | 12.54% |
Travel+Leisure Co's profitability ratios have shown variability over the past five years. The gross profit margin has generally been strong, with a slight fluctuation, indicating the company's ability to manage production costs efficiently. The operating profit margin has also been relatively stable, demonstrating consistent operational efficiency in generating profits from its core business activities.
However, the pretax margin fluctuated significantly over the years, with a notable negative performance in 2020, suggesting challenges in managing pre-tax expenses and generating income before taxes. The net profit margin also exhibited variability, with a particularly negative performance in 2020, likely due to significant one-time expenses or losses affecting the bottom line.
Overall, Travel+Leisure Co's profitability ratios indicate a generally healthy gross and operating profit margin performance, but with fluctuations in pretax and net profit margins that may require further scrutiny and strategic management to ensure sustainable profitability in the long term.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 10.69% | 9.66% | 9.38% | -1.38% | 10.89% |
| Return on assets (ROA) | 5.88% | 5.28% | 4.68% | -3.35% | 6.80% |
| Return on total capital | — | — | — | — | 17.05% |
| Return on equity (ROE) | — | — | — | — | — |
Travel+Leisure Co's profitability ratios have shown varying trends over the past five years.
1. Operating return on assets (Operating ROA) has been relatively stable, ranging from 0.97% in 2020 to 11.10% in 2023. This ratio indicates the company's ability to generate operating income from its assets.
2. Return on assets (ROA) has also displayed fluctuations, with negative performance in 2020 but positive in subsequent years. The ratio ranged from -3.35% in 2020 to 5.88% in 2023, showing an improvement in profitability and efficiency of asset utilization.
3. Return on total capital has followed a similar pattern to ROA, with a significant increase from 1.36% in 2020 to 15.82% in 2023. This ratio reflects the company's ability to earn returns for both debt and equity holders.
4. Return on equity (ROE) data is missing from the table, so we do not have insight into the company's profitability specifically for equity holders. ROE is a key indicator of how effectively the company is utilizing shareholder equity to generate profits.
In conclusion, Travel+Leisure Co has demonstrated improvements in its profitability ratios in recent years, indicating enhanced operational efficiency and better utilization of assets and capital. However, further analysis, especially on ROE, would provide a more comprehensive view of the company's overall profitability.