Operating Profit Margin
since 2005
Calculation
Texas Pacific Land Corp., operating profit margin, long-term trends, calculation
| Operating profit margin | = | 100 | × | Operating income1 | ÷ | Revenues1 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2023 | 76.96% | = | 100 | × | 486,053) | ÷ | 631,595) |
| Dec 31, 2022 | 84.25% | = | 100 | × | 562,307) | ÷ | 667,422) |
| Dec 31, 2021 | 80.36% | = | 100 | × | 362,393) | ÷ | 450,958) |
| Dec 31, 2020 | 71.81% | = | 100 | × | 217,251) | ÷ | 302,554) |
| Dec 31, 2019 | 81.46% | = | 100 | × | 399,573) | ÷ | 490,496) |
| Dec 31, 2018 | 86.88% | = | 100 | × | 260,834) | ÷ | 300,220) |
| Dec 31, 2017 | 90.51% | = | 100 | × | 119,776) | ÷ | 132,329) |
| Dec 31, 2016 | 91.90% | = | 100 | × | 55,058) | ÷ | 59,911) |
| Dec 31, 2015 | 94.76% | = | 100 | × | 75,256) | ÷ | 79,415) |
| Dec 31, 2014 | 93.14% | = | 100 | × | 51,417) | ÷ | 55,202) |
| Dec 31, 2013 | 90.98% | = | 100 | × | 40,131) | ÷ | 44,109) |
| Dec 31, 2012 | 89.92% | = | 100 | × | 29,303) | ÷ | 32,587) |
| Dec 31, 2011 | 89.61% | = | 100 | × | 30,737) | ÷ | 34,301) |
| Dec 31, 2010 | 81.72% | = | 100 | × | 16,398) | ÷ | 20,066) |
| Dec 31, 2009 | 76.35% | = | 100 | × | 9,991) | ÷ | 13,085) |
| Dec 31, 2008 | 80.72% | = | 100 | × | 15,576) | ÷ | 19,296) |
| Dec 31, 2007 | 74.41% | = | 100 | × | 11,508) | ÷ | 15,465) |
| Dec 31, 2006 | 72.65% | = | 100 | × | 16,318) | ÷ | 22,461) |
| Dec 31, 2005 | 77.41% | = | 100 | × | 11,927) | ÷ | 15,408) |
Based on: 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), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
1 US$ in thousands
An analysis of the financial performance from 2005 to 2023 reveals a significant long-term expansion in both scale and profitability. Operating income grew from 11.9 million US dollars in 2005 to 486.1 million US dollars in 2023, while revenues increased from 15.4 million US dollars to 631.6 million US dollars over the same period. Throughout this timeframe, the entity maintained exceptionally high operating profit margins, consistently remaining above 70%.
- Margin Expansion and Peak Performance
- A period of sustained margin growth occurred between 2010 and 2015. During this window, the operating profit margin rose from 81.72% to a peak of 94.76%. This indicates a phase of high operational efficiency where revenue growth significantly outpaced the growth of operating expenses.
- Operational Margin Compression
- Following the 2015 peak, a downward trend in margins is observed, extending through 2020. Despite absolute revenues and operating income reaching record highs in 2018 and 2019, the margin declined steadily from 91.90% in 2016 to a period low of 71.81% in 2020. This compression suggests a relative increase in the cost of operations compared to revenue generation during this interval.
- Recent Volatility and Current Standing
- The most recent data indicates a period of volatility. The operating profit margin recovered to 84.25% by 2022, before contracting again to 76.96% in 2023. While the current margin remains high by general industry standards, it represents a decline from the peak efficiency levels observed in the mid-2010s.
- Revenue and Income Correlation
- The relationship between revenue and operating income demonstrates strong positive correlation, though the magnitude of growth accelerated sharply after 2017. The leap in operating income from 119.8 million US dollars in 2017 to a peak of 562.3 million US dollars in 2022 underscores a massive scaling of the business model, even as the percentage of profit captured per dollar of revenue fluctuated.
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