DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
Decomposing ROE involves expressing net income divided by shareholders’ equity as the product of component ratios.
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Two-Component Disaggregation of ROE
Mondelēz International Inc., decomposition of ROE
| ROE | = | ROA | × | Financial Leverage | |
|---|---|---|---|---|---|
| Dec 31, 2024 | = | × | |||
| Dec 31, 2023 | = | × | |||
| Dec 31, 2022 | = | × | |||
| Dec 31, 2021 | = | × | |||
| Dec 31, 2020 | = | × |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Return on Assets (ROA)
- ROA exhibited fluctuations over the observed periods. It increased from 5.24% in 2020 to 6.41% in 2021, indicating an improvement in asset efficiency during that time. However, the ratio declined significantly to 3.82% in 2022 before rebounding sharply to 6.95% in 2023. In 2024, ROA maintained a high level at 6.73%, slightly below the previous year but still markedly above the 2022 low. This pattern suggests variability in the company's ability to generate profit from its assets, with a notable recovery after 2022.
- Financial Leverage
- Financial leverage remained relatively stable, with modest fluctuations around an average level. Starting at a ratio of 2.46 in 2020, it decreased slightly to 2.37 in 2021. It then increased to 2.65 in 2022, the highest in the observed period, indicating somewhat greater use of debt relative to equity at that time. The leverage ratio then declined to 2.52 in 2023 and showed a minimal increase to 2.54 in 2024. Overall, the company maintained a consistent leverage level, without major shifts towards either increased or decreased financial risk.
- Return on Equity (ROE)
- ROE demonstrated notable volatility, reflecting changes in profitability relative to shareholders’ equity. The ratio improved from 12.89% in 2020 to 15.21% in 2021, evidencing enhanced returns to equity holders. In 2022, ROE dropped to 10.11%, its lowest point in the dataset, indicating a significant decrease in equity profitability that year. A strong recovery followed, with ROE rising sharply to 17.5% in 2023 and slightly decreasing to 17.12% in 2024. The substantial rebound and sustained high level suggest improved profitability and efficient equity utilization in the most recent years.
Three-Component Disaggregation of ROE
Mondelēz International Inc., decomposition of ROE
| ROE | = | Net Profit Margin | × | Asset Turnover | × | Financial Leverage | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2024 | = | × | × | ||||
| Dec 31, 2023 | = | × | × | ||||
| Dec 31, 2022 | = | × | × | ||||
| Dec 31, 2021 | = | × | × | ||||
| Dec 31, 2020 | = | × | × |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Net Profit Margin
- The net profit margin displayed variability over the analyzed periods. It initially increased from 13.37% in 2020 to a peak of 14.97% in 2021, indicating improved profitability. However, there was a notable decline to 8.63% in 2022, suggesting a temporary reduction in operational efficiency or increased costs. The margin rebounded to 13.77% in 2023 and slightly decreased to 12.65% in 2024, maintaining a relatively stable and moderate profitability level in the latter years.
- Asset Turnover
- Asset turnover exhibited a consistent upward trend throughout the period. Starting at 0.39 in 2020, it increased each year, reaching 0.53 by 2024. This gradual improvement indicates enhanced efficiency in utilizing assets to generate revenue, suggesting better asset management or increased sales relative to asset base over time.
- Financial Leverage
- Financial leverage ratios fluctuated moderately across the years. It decreased slightly from 2.46 in 2020 to 2.37 in 2021, followed by a peak of 2.65 in 2022. Subsequently, it declined again to 2.52 in 2023 and marginally increased to 2.54 in 2024. These changes suggest some variability in the company's use of debt relative to equity, but overall leverage remained within a narrow range without extreme shifts.
- Return on Equity (ROE)
- Return on equity experienced considerable fluctuations. ROE rose from 12.89% in 2020 to 15.21% in 2021, indicating improved overall profitability and returns to shareholders. In 2022, there was a significant decrease to 10.11%, aligning with the dip in net profit margin. However, the metric surged considerably to reach a peak of 17.5% in 2023, before slightly decreasing to 17.12% in 2024. The pattern suggests a strong recovery and superior performance in the last two years, potentially driven by improved operational efficiency and prudent use of financial leverage.
Five-Component Disaggregation of ROE
Mondelēz International Inc., decomposition of ROE
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Tax Burden
- The tax burden ratio remained relatively stable over the five-year period, fluctuating slightly between 0.74 and 0.78. It showed a minor increase from 0.74 in 2020 to 0.78 in 2021, then settled around 0.76 for the following years through 2024.
- Interest Burden
- The interest burden ratio exhibited modest fluctuations, increasing from 0.92 in 2020 to 0.94 in 2021, then declining to 0.89 in 2022. It recovered to 0.92 in 2023 and maintained this level in 2024, indicating some variation but overall consistency near the initial value.
- EBIT Margin
- The EBIT margin showed notable volatility. It increased from 19.57% in 2020 to a peak of 20.39% in 2021, followed by a sharp decline to 12.73% in 2022. Subsequently, it rebounded to 19.56% in 2023 before experiencing a slight decrease to 18.08% in 2024, indicating cycles of profitability shifts.
- Asset Turnover
- Asset turnover demonstrated a positive upward trend throughout the period. Starting at 0.39 in 2020, it steadily increased each year, reaching 0.53 by 2024. This suggests a consistent improvement in the efficiency with which the company utilized its assets to generate revenue.
- Financial Leverage
- Financial leverage ratios fluctuated within a moderate range. It decreased slightly from 2.46 in 2020 to 2.37 in 2021, rose to 2.65 in 2022, then modestly declined again to 2.52 in 2023 and 2.54 in 2024. Overall, leverage remained stable, indicating consistent use of debt relative to equity.
- Return on Equity (ROE)
- ROE experienced some variability but generally trended upwards. It rose from 12.89% in 2020 to 15.21% in 2021, declined to 10.11% in 2022 coinciding with the EBIT margin drop, then increased significantly to 17.5% in 2023 before slightly decreasing to 17.12% in 2024. This reflects fluctuating but eventually improving shareholder returns over the five-year period.
Two-Component Disaggregation of ROA
Mondelēz International Inc., decomposition of ROA
| ROA | = | Net Profit Margin | × | Asset Turnover | |
|---|---|---|---|---|---|
| Dec 31, 2024 | = | × | |||
| Dec 31, 2023 | = | × | |||
| Dec 31, 2022 | = | × | |||
| Dec 31, 2021 | = | × | |||
| Dec 31, 2020 | = | × |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Net Profit Margin
- The net profit margin exhibited fluctuations over the five-year period. It increased from 13.37% in 2020 to a peak of 14.97% in 2021, indicating an improvement in profitability during that year. However, this was followed by a significant decline to 8.63% in 2022, suggesting a period of reduced profitability or increased costs. Subsequently, the margin recovered to 13.77% in 2023 but experienced a slight decrease to 12.65% in 2024. Overall, despite some volatility, the margin remains relatively stable, generally above 12% in most years except 2022.
- Asset Turnover
- The asset turnover ratio shows a consistent upward trend from 0.39 in 2020 to 0.53 in 2024. This gradual increase indicates enhanced efficiency in using assets to generate sales over time, implying either improved operational performance or better management of asset resources.
- Return on Assets (ROA)
- The ROA follows a trajectory similar to that of the net profit margin, reflecting fluctuations in the company's profitability relative to its asset base. It rose from 5.24% in 2020 to 6.41% in 2021, then dropped markedly to 3.82% in 2022, before rebounding to 6.95% in 2023 and slightly declining to 6.73% in 2024. This pattern underscores a period of lower asset efficiency in 2022, with recovery in subsequent periods.
- Overall Insights
- The data reveals a period of volatility in profitability metrics around 2022, with both net profit margin and ROA experiencing notable declines. Meanwhile, asset turnover consistently improved, suggesting that while asset efficiency increased steadily, other factors affecting profitability, such as costs or pricing, may have adversely impacted returns in 2022. The recovery in most profitability measures post-2022 indicates the company was able to mitigate challenges and improve performance subsequently.
Four-Component Disaggregation of ROA
Mondelēz International Inc., decomposition of ROA
| ROA | = | Tax Burden | × | Interest Burden | × | EBIT Margin | × | Asset Turnover | |
|---|---|---|---|---|---|---|---|---|---|
| Dec 31, 2024 | = | × | × | × | |||||
| Dec 31, 2023 | = | × | × | × | |||||
| Dec 31, 2022 | = | × | × | × | |||||
| Dec 31, 2021 | = | × | × | × | |||||
| Dec 31, 2020 | = | × | × | × |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Tax Burden
- The tax burden ratio exhibited a moderate increase from 0.74 in 2020 to 0.78 in 2021, followed by stabilization at 0.76 from 2022 through 2024. This indicates a slight increase in the effective tax rate in 2021, which then remained relatively steady in subsequent years.
- Interest Burden
- The interest burden ratio showed minor fluctuations, beginning at 0.92 in 2020, rising to 0.94 in 2021, then decreasing to 0.89 in 2022 before returning to 0.92 for 2023 and 2024. Overall, the interest burden remained fairly consistent, indicating stable interest expenses relative to earnings before interest and taxes.
- EBIT Margin
- The EBIT margin displayed volatility during the period, rising from 19.57% in 2020 to a peak of 20.39% in 2021. It then dropped sharply to 12.73% in 2022, followed by a recovery to 19.56% in 2023 and a slight decrease to 18.08% in 2024. This pattern suggests a significant margin contraction in 2022 with subsequent improvement, although not fully returning to the peak margin achieved in 2021.
- Asset Turnover
- The asset turnover ratio demonstrated a steady upward trend throughout the examined years, increasing from 0.39 in 2020 to 0.53 in 2024. The consistent improvement indicates enhanced efficiency in using assets to generate sales over the period.
- Return on Assets (ROA)
- ROA mirrored the fluctuations observed in EBIT margin, increasing from 5.24% in 2020 to 6.41% in 2021, declining to 3.82% in 2022, then rising again to 6.95% in 2023 and slightly dipping to 6.73% in 2024. This trend highlights variability in overall asset profitability, with a notable dip in 2022 followed by recovery.
Disaggregation of Net Profit Margin
Mondelēz International Inc., decomposition of net profit margin ratio
| Net Profit Margin | = | Tax Burden | × | Interest Burden | × | EBIT Margin | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2024 | = | × | × | ||||
| Dec 31, 2023 | = | × | × | ||||
| Dec 31, 2022 | = | × | × | ||||
| Dec 31, 2021 | = | × | × | ||||
| Dec 31, 2020 | = | × | × |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Tax Burden
- The tax burden ratio demonstrated a slight upward adjustment from 0.74 in 2020 to 0.78 in 2021. Subsequently, it stabilized at 0.76 through 2022 to 2024, indicating a consistent proportion of earnings retained after tax over the latter four years.
- Interest Burden
- The interest burden ratio showed minor fluctuations, increasing from 0.92 in 2020 to 0.94 in 2021, then declining to 0.89 in 2022. It rebounded to 0.92 in 2023 and remained steady through 2024. This pattern suggests slight variability in the impact of interest expenses on operating income but generally stable levels overall.
- EBIT Margin
- EBIT margin peaked in 2021 at 20.39%, followed by a significant decline to 12.73% in 2022. It then recovered to near 2020 levels at 19.56% in 2023 but decreased moderately to 18.08% in 2024. This indicates that operating profitability experienced a notable dip in 2022 but largely recovered thereafter, albeit with a marginal decline in the latest period.
- Net Profit Margin
- The net profit margin closely mirrored the EBIT margin trend, increasing from 13.37% in 2020 to 14.97% in 2021, then dropping substantially to 8.63% in 2022. It recovered to 13.77% in 2023 before slightly falling to 12.65% in 2024. This pattern reflects a significant compression in net profitability in 2022, followed by a substantial but incomplete recovery.