Walgreens Boots Alliance Inc (WBA)
Profitability ratios
Return on sales
| Aug 31, 2024 | Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 17.75% | 19.27% | 21.26% | 21.28% | 18.76% |
| Operating profit margin | -9.42% | -4.90% | 1.04% | 1.78% | 0.71% |
| Pretax margin | -4.95% | -3.52% | 3.24% | 2.43% | 0.57% |
| Net profit margin | -5.78% | -2.19% | 3.26% | 1.93% | 0.33% |
The profitability ratios of Walgreens Boots Alliance Inc have fluctuated over the past five years. The gross profit margin has shown a declining trend, decreasing from 21.28% in 2021 to 17.75% in 2024. This indicates that the company's profitability from sales has been reducing over the years.
The operating profit margin also reflects a similar negative trend, dropping from 1.78% in 2021 to -9.42% in 2024, signifying that the company's ability to generate profit from its core operations has deteriorated significantly.
The pretax margin has been inconsistent, with a notable decline in 2024 to -4.95% from 3.24% in 2022. This indicates that the company's profitability before accounting for taxes has been impacted by various factors over the years.
The net profit margin, which is the bottom line profitability ratio, has also exhibited volatility, with a significant drop to -5.78% in 2024 from 3.26% in 2022. This indicates that the company's overall profitability after all expenses, including taxes, has decreased significantly.
Overall, the declining trend in gross profit margin, operating profit margin, pretax margin, and net profit margin suggests challenges in enhancing profitability and efficiency in the company's operations. Further analysis of the underlying factors influencing these ratios would be necessary to determine the specific reasons for the decrease in profitability over the years.
Return on investment
| Aug 31, 2024 | Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | -17.37% | -7.12% | 1.54% | 2.88% | 1.13% |
| Return on assets (ROA) | -10.66% | -3.19% | 4.81% | 3.13% | 0.52% |
| Return on total capital | -37.36% | -15.47% | 13.12% | 13.23% | 4.29% |
| Return on equity (ROE) | -82.68% | -15.38% | 17.16% | 10.85% | 2.21% |
The profitability ratios of Walgreens Boots Alliance Inc show fluctuating trends over the past five years.
1. Operating return on assets (Operating ROA) has shown a downward trend, indicating a decrease in the company's ability to generate operating profits from its assets. This ratio was negative in the last two years, suggesting that the company's operating performance has not been efficient.
2. Return on assets (ROA) also indicates a declining trend over the period, with negative values in the last two years. This metric reflects the overall profitability of the company in generating earnings from its total assets, and the negative values suggest that the company's earnings may not be sufficient to cover its assets.
3. Return on total capital has exhibited significant fluctuations, with a notable decrease in the most recent year. This ratio reflects the company's ability to generate returns from both equity and debt capital invested. The negative value in the latest year indicates a significant decrease in the overall return generated from total capital.
4. Return on equity (ROE) has shown volatile movements, with a substantial decline in the latest year to a negative value. ROE measures the profitability of the company from the perspective of its shareholders, and the negative value indicates that the company is not efficiently utilizing shareholders' equity to generate profits.
Overall, the profitability ratios of Walgreens Boots Alliance Inc demonstrate a mixed performance, with a general decline in profitability and efficiency in generating returns from assets and capital over the past five years. The negative values in certain years raise concerns about the company's operational efficiency and financial health.