Willscot Mobile Mini Holdings Corp A (WSC)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 54.34% | 56.41% | 52.99% | 51.10% | 48.26% |
| Operating profit margin | 11.02% | 28.48% | 23.87% | 19.01% | 18.85% |
| Pretax margin | 1.53% | 19.81% | 17.04% | 11.07% | 1.49% |
| Net profit margin | 1.17% | 20.15% | 15.85% | 8.45% | 5.42% |
The profitability ratios of Willscot Mobile Mini Holdings Corp A over the period from December 31, 2020, to December 31, 2024, reveal notable trends and fluctuations that provide insight into the company's earning efficiency and overall financial performance.
Gross Profit Margin experienced a steady improvement throughout the period, increasing from 48.26% in 2020 to a peak of 56.41% in 2023. This upward trend indicates an enhancement in the company's core profitability, likely attributable to better cost management or increased pricing power. However, in 2024, a slight decrease to 54.34% suggests some pressures on gross profitability, which may be due to increased costs or competitive factors affecting pricing strategies.
Operating Profit Margin displayed a strong upward trend from 18.85% in 2020 to 28.48% in 2023, reflecting improved operational efficiency and scale benefits. The significant jump between 2021 and 2022, from 19.01% to 23.87%, suggests operational improvements and cost controls. Nevertheless, in 2024, the operating margin dropped sharply to 11.02%, indicating a deterioration in operational profitability. This decline could be associated with increased operating expenses, strategic investments, or external market pressures impacting operational cost structures.
Pre-tax Margin mirrors the operating margin pattern, rising from 1.49% in 2020 to a peak of 19.81% in 2023, before sharply declining to 1.53% in 2024. The substantial decrease in 2024 indicates a significant decline in pre-tax profitability, possibly due to increased non-operating expenses, impairments, or extraordinary items affecting pre-tax income.
Net Profit Margin followed a similar trajectory, improving from 5.42% in 2020 to reach 20.15% in 2023, marking a period of robust net earnings relative to revenue. However, in 2024, the net profit margin plummeted to 1.17%, nearing negligible levels. This drastic decline may be attributable to extraordinary charges, tax issues, or other factors negatively impacting the bottom line.
Overall, the data depict a company that experienced a period of strong profitability growth through 2023, likely driven by operational efficiencies and margin expansion. However, the sharp downturn in 2024 across all profitability ratios suggests significant challenges that have adversely affected overall profitability, warranting further investigation into underlying causes such as increased costs, one-time charges, or changing market conditions.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 4.37% | 10.97% | 8.78% | 6.24% | 4.63% |
| Return on assets (ROA) | 0.47% | 7.76% | 5.83% | 2.77% | 1.33% |
| Return on total capital | 27.89% | 54.31% | 32.39% | 12.81% | 6.24% |
| Return on equity (ROE) | 2.76% | 37.78% | 21.69% | 8.02% | 3.46% |
The profitability ratios of Willscot Mobile Mini Holdings Corp A over the period from December 31, 2020, to December 31, 2024, depict a pattern of overall growth followed by a notable decline in the most recent year.
The Operating Return on Assets (Operating ROA) demonstrates a positive trend from 4.63% in 2020 to a peak of 10.97% in 2023, indicating enhanced efficiency in generating operating income relative to the company's assets. However, in 2024, this metric sharply declines to 4.37%, suggesting a reduction in operational efficiency or increased asset base without proportional increases in operating income.
Similarly, the standard Return on Assets (ROA) shows a progressive increase from 1.33% in 2020 to 7.76% in 2023, reflecting improved overall asset utilization and profitability. Yet, it drops significantly to 0.47% in 2024, signaling a substantial deterioration in net profitability relative to total assets during that year.
Return on Total Capital exhibits a significant upward trend, rising from 6.24% in 2020 to a peak of 54.31% in 2023, illustrating an increasingly effective deployment of both debt and equity capital to generate earnings. Nonetheless, a decrease to 27.89% in 2024 indicates a reduction in overall capital efficiency.
The Return on Equity (ROE) aligns with the pattern seen in other ratios, escalating from 3.46% in 2020 to a high of 37.78% in 2023, reflecting enhanced shareholder value creation during this period. The decline to 2.76% in 2024, however, suggests a significant erosion of equity returns, potentially due to declining net income or increased equity base without commensurate income growth.
In summary, the financial ratios reveal that Willscot Mobile Mini Holdings Corp A experienced substantial improvements in profitability metrics from 2020 through 2023, indicating strong operational performance and capital efficiency during this period. The sharp downturn in 2024 across all profitability ratios indicates a notable decline in profitability and operational effectiveness in that year.