Unifirst Corporation (UNF)
Net profit margin
| Aug 26, 2023 | Aug 27, 2022 | Aug 28, 2021 | Aug 29, 2020 | Aug 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 103,674 | 103,404 | 151,111 | 135,770 | 179,134 |
| Revenue | US$ in thousands | 2,239,780 | 2,003,670 | 1,828,780 | 1,810,540 | 1,818,460 |
| Net profit margin | 4.63% | 5.16% | 8.26% | 7.50% | 9.85% |
August 26, 2023 calculation
Net profit margin = Net income ÷ Revenue
= $103,674K ÷ $2,239,780K
= 4.63%
The net profit margin is a crucial financial ratio that measures a company's ability to generate profit from its revenue. It is calculated as net income divided by total revenue and is expressed as a percentage.
Looking at the net profit margin of Unifirst Corp. over the past five years, we observe a gradual decline from 9.90% in 2019 to 4.64% in 2023. This decreasing trend indicates a potential erosion in the company's ability to convert revenue into profit.
Several factors could contribute to this decline. It's important to investigate the company's cost control measures, pricing strategies, and operational efficiency during this period. A rise in operating expenses, such as raw materials, labor, or administrative costs, could have squeezed the company's profit margins.
Furthermore, changes in the company's revenue streams, such as a shift towards lower-margin products or services, could also impact the net profit margin. Examination of the company's pricing strategies and sales mix could provide insights into these potential shifts.
In addition, a fluctuation in the company's tax burdens or interest expenses can impact the net profit margin. Understanding the company's tax management and financing activities is essential for a comprehensive analysis.
It's important to note that while a declining net profit margin raises concerns about the company's profitability, it should be analyzed alongside other financial ratios and contextual factors to gain a deeper understanding of the company's overall financial performance.
Peer comparison
Aug 26, 2023