Name: Operating Profit Margin

Definition: Operating profit margin focuses on profits from the company’s core business — before interest payments and taxes. It reflects how well the business manages operating costs relative to sales. Strong operating margins show efficient day-to-day operations. Shrinking margins may reveal rising overhead, pricing weakness, or declining efficiency.

Interpretation:
• In '2021', PAGP's operating profit margin was 3.4%, highlighting profit earned from core business operations. Industry average for Natural Gas Distribution in '2021' stood at 20.6%.
• In '2022', PAGP's operating profit margin was 2.7%, highlighting profit earned from core business operations. The decline from '2021' may indicate some operational or financial challenges. Industry average for Natural Gas Distribution in '2022' stood at 20.1%. Industry average declined by 0.5% from previous year.
• In '2023', PAGP's operating profit margin was 2.8%, highlighting profit earned from core business operations. The increase since '2022' reflects strengthening financial performance. Industry average for Natural Gas Distribution in '2023' stood at 21.2%. Industry average increased by 1.1% compared to previous year.
• In '2024', PAGP's operating profit margin was 2.7%, highlighting profit earned from core business operations. The decline from '2023' may indicate some operational or financial challenges. Industry average for Natural Gas Distribution in '2024' stood at 22.4%. Industry average increased by 1.2% compared to previous year.
Overall, PAGP's operating profit margin has remained generally stable over the past 4 years.

Formula: Operating Profit Margin = Operating Income / Revenue

Good Range: Often 10%-30% depending on business model.