West Pharmaceutical Services Inc (WST)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 38.69% | 39.36% | 41.52% | 35.76% | 32.92% |
| Operating profit margin | 23.16% | 25.43% | 26.57% | 18.95% | 16.12% |
| Pretax margin | 24.52% | 24.27% | 27.16% | 19.50% | 16.34% |
| Net profit margin | 20.33% | 20.30% | 23.37% | 16.13% | 13.14% |
West Pharmaceutical Services, Inc. has displayed a consistent trend of profitability improvement over the past five years based on its profitability ratios. The gross profit margin has fluctuated slightly but remained within a relatively stable range, indicating consistent control over the cost of goods sold.
The operating profit margin has shown a steady increase from 15.98% in 2019 to 23.98% in 2023, demonstrating the company's ability to efficiently manage its operational expenses and generate profits from its core business activities.
Similarly, the pretax margin has also exhibited a positive trend, increasing from 16.34% in 2019 to 24.26% in 2023, indicating effective management of both operating and non-operating expenses.
Moreover, the net profit margin has shown consistent improvement, reflecting the company's ability to generate net profits from its total revenues. The net profit margin increased from 13.14% in 2019 to 20.12% in 2023, showcasing a positive trend in the company's bottom-line profitability.
Overall, the profitability ratios of West Pharmaceutical Services, Inc. suggest that the company has been successful in enhancing its overall profitability through efficient cost management and revenue generation strategies.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 17.65% | 20.29% | 22.70% | 14.56% | 12.67% |
| Return on assets (ROA) | 15.50% | 16.20% | 19.97% | 12.39% | 10.32% |
| Return on total capital | 24.53% | 24.50% | 30.55% | 20.26% | 16.91% |
| Return on equity (ROE) | 20.60% | 21.82% | 28.34% | 18.67% | 15.36% |
West Pharmaceutical Services, Inc. has exhibited consistent profitability over the past five years, as evident from its key profitability ratios. The company's Operating Return on Assets (Operating ROA) has shown a slight decrease from 22.94% in 2021 to 18.47% in 2023, but remains robust, indicating its efficiency in generating operating income relative to its total assets.
The Return on Assets (ROA) has also been healthy, with a steady increase from 10.32% in 2019 to 15.50% in 2023. This ratio reflects the company's ability to generate profit from its assets, with the latest figure indicating a positive trend in asset utilization and overall profitability.
Moreover, the Return on Total Capital and Return on Equity (ROE) ratios have shown consistent growth over the years, with the company achieving 23.48% and 20.60% respectively in 2023. These ratios demonstrate the company's ability to deliver returns to both its total capital providers and equity shareholders, highlighting its effective management of finances and investment in profitable projects.
In summary, West Pharmaceutical Services, Inc. has demonstrated solid profitability performance, as indicated by its improving profitability ratios across the board, reflecting efficient asset utilization, sound financial management, and strong returns to investors.