Operating Profit Margin
since 2005
Calculation
Valero Energy Corp., operating profit margin, long-term trends, calculation
| Operating profit margin | = | 100 | × | Operating income (loss)1 | ÷ | Revenues1 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2023 | 8.19% | = | 100 | × | 11,858) | ÷ | 144,766) |
| Dec 31, 2022 | 8.90% | = | 100 | × | 15,690) | ÷ | 176,383) |
| Dec 31, 2021 | 1.87% | = | 100 | × | 2,130) | ÷ | 113,977) |
| Dec 31, 2020 | -2.43% | = | 100 | × | (1,579) | ÷ | 64,912) |
| Dec 31, 2019 | 3.54% | = | 100 | × | 3,836) | ÷ | 108,324) |
| Dec 31, 2018 | 3.91% | = | 100 | × | 4,572) | ÷ | 117,033) |
| Dec 31, 2017 | 3.83% | = | 100 | × | 3,599) | ÷ | 93,980) |
| Dec 31, 2016 | 4.72% | = | 100 | × | 3,572) | ÷ | 75,659) |
| Dec 31, 2015 | 7.24% | = | 100 | × | 6,358) | ÷ | 87,804) |
| Dec 31, 2014 | 4.51% | = | 100 | × | 5,902) | ÷ | 130,844) |
| Dec 31, 2013 | 2.87% | = | 100 | × | 3,963) | ÷ | 138,074) |
| Dec 31, 2012 | 2.88% | = | 100 | × | 4,010) | ÷ | 139,250) |
| Dec 31, 2011 | 2.92% | = | 100 | × | 3,680) | ÷ | 125,987) |
| Dec 31, 2010 | 2.28% | = | 100 | × | 1,876) | ÷ | 82,233) |
| Dec 31, 2009 | -0.09% | = | 100 | × | (58) | ÷ | 68,144) |
| Dec 31, 2008 | 0.47% | = | 100 | × | 563) | ÷ | 119,114) |
| Dec 31, 2007 | 7.26% | = | 100 | × | 6,918) | ÷ | 95,327) |
| Dec 31, 2006 | 8.72% | = | 100 | × | 8,010) | ÷ | 91,833) |
| Dec 31, 2005 | 6.64% | = | 100 | × | 5,459) | ÷ | 82,162) |
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 millions
The operating profit margin exhibits significant volatility over the period from 2005 to 2023, reflecting the cyclical nature of the energy refining industry and its sensitivity to global commodity price fluctuations. The margin has fluctuated between a low of -2.43% and a high of 8.90%, characterized by distinct periods of contraction and expansion.
- Periods of Margin Contraction
- Two primary downturns are observable. The first occurred between 2008 and 2009, where the operating profit margin collapsed from 7.26% in 2007 to 0.47% in 2008, reaching a negative value of -0.09% in 2009. The second, and more severe, contraction occurred in 2020, with the margin falling to -2.43%. These troughs coincide with periods of significant revenue decline, indicating high operational leverage and vulnerability to external market shocks.
- Recovery and Stabilization Trends
- Following the 2009 slump, the margin entered a phase of moderate stabilization between 2010 and 2019. During this decade, margins generally remained within a corridor of 1.87% to 7.24%. A notable peak occurred in 2015 at 7.24%, while the subsequent years showed a gradual convergence toward a range of 3% to 4%.
- Recent Performance and Peak Expansion
- A sharp recovery is evident post-2020. The operating profit margin rose from -2.43% in 2020 to 1.87% in 2021, culminating in a period of peak performance in 2022 and 2023. The margin reached 8.90% in 2022, the highest level recorded in the analyzed timeframe, and remained elevated at 8.19% in 2023. This expansion was supported by a substantial increase in operating income, which peaked at 15.69 billion US dollars in 2022.
- Revenue and Income Correlation
- There is a non-linear relationship between revenue volume and profit margins. For instance, the highest revenue year (2022 at 176.38 billion US dollars) also produced the highest operating margin. Conversely, periods of high revenue, such as 2011 and 2012, did not necessarily translate to high margins, with values remaining below 3%. This suggests that profitability is driven more by refining spreads and operational efficiency than by top-line revenue growth alone.
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