Accenture PLC (NYSE:ACN)

Net Operating Profit After Taxes (NOPAT)

The net operating profit after taxes exhibited a general upward trend from 2019 to 2024. Starting at approximately 4,992,768 thousand US dollars in 2019, it increased steadily to 7,515,553 thousand US dollars by 2024. This reflects consistent operational profitability growth over the six-year period, with a notable increase each year except a slight decrease observed in 2023 compared to 2022.

Invested Capital

Invested capital showed a continuous increase throughout the entire period, rising from around 20,110,534 thousand US dollars in 2019 to 36,963,067 thousand US dollars in 2024. This indicates an expanding capital base with investments growing by approximately 84% over six years, signaling ongoing commitment to asset growth or operational expansion.

Return on Invested Capital (ROIC)

Return on invested capital displayed a declining trend from 2019 to 2024. ROIC peaked at 26.3% in 2020 but gradually decreased thereafter each year, reaching 20.33% by 2024. Despite the increase in net operating profit and invested capital, the falling ROIC suggests that the incremental capital employed has yielded progressively lower returns, indicating diminishing capital efficiency over the analyzed period.

The financial indicators demonstrate distinct trends over the analyzed period from 2019 to 2024. Each ratio presents fluctuations indicative of operational, capital efficiency, tax effectiveness, and profitability dynamics.

Operating Profit Margin (OPM)

The operating profit margin showed an initial improvement, rising from 14.89% in 2019 to a peak of 16.65% in 2021. Subsequently, it declined to 14.56% in 2023 before a modest recovery to 15.15% in 2024. This pattern suggests that while operational efficiency strengthened during the early years, there was some compression of operating margins in the following years, with partial restoration in the latest period.

Turnover of Capital (TO)

Capital turnover decreased steadily from 2.16 in 2019 to 1.76 in 2024, indicating a gradual reduction in how effectively the company utilizes its capital to generate revenue. The ratio dipped most noticeably between 2023 and 2024, implying a slowdown in capital utilization efficiency.

1 – Effective Cash Tax Rate (CTR)

This metric, interpreted as the proportion of pre-tax income retained after cash taxes, fluctuated moderately with values ranging from 74.45% to 80.66%. It peaked in 2020 at 80.66% and decreased thereafter, ending at 76.13% in 2024. The movement denotes some variability in cash tax obligations, albeit remaining relatively high, suggesting consistent cash tax efficiency throughout the periods.

Return on Invested Capital (ROIC)

The return on invested capital declined from a high of 26.3% in 2020 to 20.33% in 2024. This decline reflects diminishing effectiveness in generating returns from invested capital over the period, correlating with the observed decrease in capital turnover and slight compression in operating profit margins.

In summary, the data point to a peak in profitability and capital efficiency early in the timeframe, followed by gradual declines in capital utilization and return measures. Despite some recovery in operating margins in the final year, overall trends indicate challenges in maintaining prior levels of capital efficiency and profitability.

Net Operating Profit Before Taxes (NOPBT)

The net operating profit before taxes has exhibited a generally upward trend over the six-year period. Starting at approximately 6.48 billion USD in 2019, it increased each year until reaching about 9.57 billion USD in 2022. A slight dip occurred in 2023, decreasing to approximately 9.39 billion USD, followed by a recovery in 2024 to roughly 9.87 billion USD. Overall, the growth in NOPBT indicates improved profitability with only minor fluctuations near the end of the period.

Adjusted Revenues

Adjusted revenues have shown a steady and substantial increase from around 43.5 billion USD in 2019 to over 65.1 billion USD in 2024. The most notable jump was observed between 2021 and 2022, where revenues increased by over 10 billion USD. This consistent growth highlights strong top-line expansion throughout the years.

Operating Profit Margin (OPM)

The operating profit margin percentage experienced an increase from 14.89% in 2019 to a peak of 16.65% in 2021. After 2021, there was a downward trend over the next two years, dropping to 14.56% in 2023, before a moderate rise to 15.15% in 2024. This pattern suggests that while profitability relative to revenue improved initially, there were some pressures or cost increases in the latter years which impacted margins, although some recovery was seen in the final year.

Adjusted Revenues

The adjusted revenues demonstrate a consistent upward trend over the six-year period. Starting from approximately 43.5 billion USD in 2019, revenues increased each year, reaching about 65.2 billion USD in 2024. This represents a significant growth in top-line figures, with notable annual increments particularly pronounced between 2020 and 2022.

Invested Capital

The invested capital also shows a steady increase throughout the period under review. Beginning at around 20.1 billion USD in 2019, this figure rose consistently year over year to nearly 37.0 billion USD by 2024. The growth in invested capital indicates ongoing investment into the company’s assets or operations.

Turnover of Capital (TO)

The turnover of capital, a ratio reflecting the efficiency with which invested capital is used to generate revenue, reveals some decline over the years. Initially at 2.16 in 2019, this ratio decreased to 1.76 by 2024. This downward trend suggests that while revenues are increasing, the rate at which capital is being turned over relative to revenue generation is diminishing, implying a lowering in operational efficiency or a greater proportion of capital investment relative to sales growth.

Overall Insights

Over the six-year horizon, the company has expanded both its revenue base and its invested capital significantly. However, the rate of capital turnover has weakened, hinting at a possible need to evaluate the productivity and utilization of investments. Growth in revenues outpaces the decline in TO ratio, suggesting that growth and scale remain positive but could be accompanied by challenges in capital management efficiency.

Cash Operating Taxes

The cash operating taxes show a general upward trend from 2019 through 2022, increasing from approximately 1.49 billion USD in 2019 to about 2.45 billion USD in 2022. This is followed by a slight decline in the subsequent two years, with values around 2.38 billion USD in 2023 and 2.36 billion USD in 2024. Overall, despite minor fluctuations, the cash operating taxes have increased substantially over the six-year period compared to the starting value.

Net Operating Profit Before Taxes (NOPBT)

The net operating profit before taxes exhibits a consistent upward trajectory from 2019 to 2024. Starting at approximately 6.48 billion USD in 2019, it rises steadily each year, reaching about 9.87 billion USD by 2024. This indicates a strong growth in operating profitability over the observed period, with minor variation in the rate of increase between years.

Effective Cash Tax Rate (CTR)

The effective cash tax rate shows some variability through the years. It decreased from 22.96% in 2019 to a low of 19.34% in 2020, then slightly increased to 20.47% in 2021. A notable rise occurs in 2022 where the rate peaks at 25.55%, followed by a slight decline to 25.34% in 2023 and further to 23.87% in 2024. Despite fluctuations, the rate generally trends upward from 2020 onward.

Summary Insights

The data reveals that while net operating profit before taxes has steadily increased over the six-year span, the cash operating taxes mirror this growth but with some moderation in the last two years. The effective cash tax rate fluctuates but generally rises after 2020, potentially indicating changes in tax strategy, tax regulations, or profitability mix. The alignment between rising NOPBT and cash taxes suggests growing taxable income, although the tax rate movements imply varying effective tax burdens.