Advanced Drainage Systems Inc (WMS)
Operating return on assets (Operating ROA)
| Mar 31, 2025 | Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 657,436 | 732,131 | 719,310 | 411,918 | 344,525 |
| Total assets | US$ in thousands | 3,690,360 | 3,268,910 | 2,901,120 | 2,649,760 | 2,413,830 |
| Operating ROA | 17.81% | 22.40% | 24.79% | 15.55% | 14.27% |
March 31, 2025 calculation
Operating ROA = Operating income ÷ Total assets
= $657,436K ÷ $3,690,360K
= 17.81%
Based on the data provided, Advanced Drainage Systems Inc has shown a consistent improvement in its operating return on assets (operating ROA) over the five-year period from March 31, 2021, to March 31, 2025. The operating ROA has increased from 14.27% in 2021 to 17.81% in 2025, indicating the company's ability to generate more operating income per dollar of assets employed.
The operating ROA increased steadily in the initial years, with a significant jump in 2023 to 24.79% before decreasing slightly in the following year to 22.40%. This fluctuation may suggest changes in the company's operational efficiency or strategic decisions impacting asset utilization and profitability.
Overall, the upward trend in operating ROA reflects Advanced Drainage Systems Inc's effective management of its operating assets to generate increasing returns, which is a positive indicator of the company's operational performance and potential for generating profits from its core business activities.