10. Productivity Ratios and Profitability Analysis

Transcription

1 10. Productivity Ratios and Profitability Analysis Productivity Ratios Total Asset Turnover, TAT (56) It measures efficiency of total assets in producing sales (usually average of total assets) Fied Turnover (57) Fied It measures efficiency of fied assets in producing sales. Current Turnover (58) Current It measures efficiency of current assets in producing sales Profitability Ratios Profitability ratios measure the earning ability of a company. Gross Margin - COGS (59) This ratio measures gross margin in each sales dollar. EBITDA Margin EBITDA (60) This ratio measures EBITDA (EBIT+depreciation) margin in each sales dollar. Operating Profit Margin Net Operating Income (61) Preta Margin (62) This ratio measures preta margin in each sales dollar. Effective Ta Rate Income Taes (63) This ratio measures effective income ta rate.

2 Net Profit Margin, Return on Sales (64) This ratio measures net income in each sales dollar. Return on (65) This ratio measures overall profitability of assets. Preta ROA (66) Return on Net Net Operating Income (1 - T) (67) ROA Total Net Return on Capital Invested (the same as above formula, different name) (68) EBIT (1 - T) ROIC LT Debt This ratio measures overall profitability of net assets (fied assets + net current assets). It can be compared with a long term IRR using FCFF cash flows. Return on (69) Net income ROE This ratio measures overall profitability of equity. It can be compared with a long term IRR using FCFE cash flows. Return on Common Stockholders (70) Net income - Preferred Dividendes ROCSE This ratio measures profitability of common stock owners DuPont Analysis Retained Earning Reinvestment Rate Taable Income - Dividends Taable Income Total Asset Turnover Preta Margin Preta ROA Preta ROA Leverage (/) Preta ROE Preta ROE Ta Compliment (equal to (1- Ta Rate)) ROE ROE Earnings Retenton (( - Dividends)/) Reinvestment Rate

3 Task Calculate productivity ratios 2. Calculate profitability ratios 3. Prepare DuPont Analysis Problem 23. Productivity Ratios Calculate and interpret productivity ratios. Total Asset Turnover, TAT Fied Turnover Fied Current Turnover Current Dec. 31, 2014 Dec. 31, 2013 Dec. 31, ,50 0,52 0,56 0,51 0,53 0,58 0,78 0,80 0,86 1,39 1,50 1,58

4 Problem 24. Profitability Ratios Calculate and interpret profitability ratios. Gross Margin - COGS EBITDA Margin EBITDA Operating Profit Margin Net Operating Income Preta Margin Income Before IncomeTaes Dec. 31, 2014 Dec. 31, 2013 Dec. 31, ,1% 60,7% 60,3% 25,4% 26,0% 26,6% 21,1% 21,8% 22,4% 20,3% 24,5% 24,6% Effective Ta Rate Income Taes Net Profit Margin, Return on Sales Return on 23,6% 24,8% 23,1% 15,5% 18,4% 18,9% 7,7% 9,6% 10,5% Preta ROA Return on Net 10,1% 12,7% 13,7% Net ROA Operating Income (1- T) Total Net 8,1% 8,5% 9,6% Return on Capital Invested (the same as above formula) EBIT (1- T) ROIC LT Debt Return on ROE Return on Common Stockholders Net income - Preferred Dividendes ROCSE no preffered stock 23,3% 25,8% 27,4%

5 Problem 25. DuPont Analysis Perform and discuss DuPont analysis RetainedEarning Reinvestment Rate TaableIncome Dividends TaableIncome Total Asset Turnover Preta Margin Preta ROA Preta ROA Leverage(/) Preta ROE Preta ROE Ta Compliment(equal to (1- Ta Rate)) ROE ROE EarningsRetenton ((- Dividends)/) Reinvestment Rate DuPont Eeaning Power Dec. 31, 2014 Dec. 31, 2013 Dec. 31, 2012 Asset Turnover 0,50 0,52 0,56 Preta margin 20,3% 24,5% 24,6% Preta ROA 10,1% 12,7% 13,7% Leverage (/) 3,01 2,69 2,60 Preta ROE 0,31 0,34 0,36 Ta Complement 76,4% 75,2% 76,9% ROE 23,3% 25,8% 27,4% Earnings Retention 24,9% 42,4% 49,4% Reinvestment Rate 5,8% 10,9% 13,5%