Woodward Inc (WWD)
Profitability ratios
Return on sales
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 10.75% | 10.90% | 12.77% | 11.93% | 13.91% |
| Operating profit margin | -4.85% | -4.21% | -2.89% | -5.39% | -1.08% |
| Pretax margin | 9.62% | 8.49% | 11.10% | 11.42% | 11.22% |
| Net profit margin | 8.11% | 7.30% | 9.42% | 9.74% | 9.09% |
Woodward Inc's profitability ratios indicate various trends over the past five years. The gross profit margin, which reflects the percentage of revenue retained after accounting for the cost of goods sold, has fluctuated between 22.05% and 25.65% during this period. This suggests some variability in the company's ability to control direct production costs and pricing strategies.
The operating profit margin, which measures the percentage of revenue remaining after deducting operating expenses, has experienced a downward trend, declining from 11.63% in 2019 to 9.46% in 2023. This could indicate challenges in managing and optimizing operating costs and efficiencies.
Similarly, the pretax margin and net profit margin, both of which assess profitability after accounting for all expenses, have also exhibited a declining trend over the five-year period. This suggests that after considering taxes and interest expenses, Woodward Inc's ability to generate profit has weakened.
Overall, the declining trend in operating, pretax, and net profit margins may indicate the company's struggle to maintain or improve its profitability, potentially due to escalating costs or pricing pressures. It would be beneficial for Woodward Inc to focus on cost management, operational efficiencies, and strategic pricing to reverse this trend and bolster its profitability in the future.
Return on investment
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | -3.47% | -2.60% | -1.56% | -3.41% | -0.78% |
| Return on assets (ROA) | 5.79% | 4.51% | 5.10% | 6.16% | 6.56% |
| Return on total capital | 11.91% | 8.98% | 9.50% | 11.64% | 14.07% |
| Return on equity (ROE) | 11.22% | 9.03% | 9.42% | 12.06% | 15.03% |
Woodward Inc's profitability ratios reflect its ability to generate returns from its assets and capital. The operating return on assets (Operating ROA) has improved from 5.32% in 2022 to 6.88% in 2023, indicating enhanced operational efficiency in utilizing assets to generate earnings. Similarly, the return on assets (ROA) has also shown improvement, reaching 5.79% in 2023 compared to 4.51% in 2022. This indicates that the company has been able to generate higher profits from its total assets.
The return on total capital has also demonstrated a positive trend, increasing to 11.20% in 2023 from 8.24% in 2022. This shows that the company has been effectively utilizing its total capital to generate higher returns. However, it's essential to note that the return on equity (ROE) has shown a decline from 9.03% in 2022 to 11.22% in 2023, signaling a reduction in the profitability of each dollar of shareholders' equity.
Overall, Woodward Inc's profitability ratios indicate improvements in operational efficiency and returns generated from assets and total capital. However, the decline in ROE suggests a need for the company to evaluate how it generates returns specifically for its equity shareholders.