Perhaps if you ask any personwhat indicator he could name as the main indicator of the performance of a company, this indicator would be profit. This is understandable, because profitability largely determines whether the enterprise will exist at all in the future. However, different organizations may be differently profitable, but they still need to be compared in some way. For this purpose, calculate the profitability indicators. In other words, profitability is a certain level of profitability.
Method of calculating profitability levelsit is extremely simple, therefore, having remembered one ratio, you will be able to calculate any indicator. The essence of the calculation is in relation to the profit to the value of the profitability of what you want to install. So, for example, it is quite obvious how to calculate the return on assets: it is enough to divide the net profit or the profit before tax by the total balance. Usually profitability is expressed as a percentage. In this case, it allows you to judge the effectiveness of the use of property that is the property of the organization. As you can see, there can be different profits in the numerator, which is a feature of this group of indicators. Depending on your choice of indicators may vary, which allows them to be regarded as sufficiently subjective.
In addition to the profitability of the entire property candetermine the profitability of current assets and non-current. It is obvious that for this it is necessary to divide the profit by the result of the relevant section of the balance, and then express it as a percentage. Return on current assets shows their ability to generate profit, as well as the effectiveness of their use. The meaning of profitability of non-current assets is similar.
You can compare profits not only with assets, butand with liabilities. The greatest interest is the return on equity of the organization, that is, the amount of profit per unit of capital of the owner. Using this criterion, one can compare various enterprises from the point of view of the owner, for example, in order to select the most attractive investment object.
When we calculate the profitability of negotiableassets, then the denominator is the sum of these assets. One of their components is the finished product, that is, its cost. Calculate product profitability can also be very helpful. This indicator will characterize how much profit is generated by the money that has generated costs. To calculate it, the sales profit has traditionally been used.
Profit from sales is also used in determining the profitability of sales, which is logical. The meaning of this profitability lies in what proportion of the company's revenue is profit.
Определение всех описанных выше показателей за one period may not be sufficient. The fact is that they do not have normative values, so they can only be compared with each other. For such a comparison, you can use either industry average indicators or indicators of enterprises-analogues. A much greater practical interest is the comparison over time, that is, a comparison with the levels of previous periods and the subsequent identification of certain trends. Obviously, the decline in profitability requires identifying the causes of deterioration, and its growth - identifying factors that can be used in the future.
Немалый интерес представляет и факторный анализ, allows to evaluate the isolated and cumulative impact of certain factors on each of the indicators of profitability. For example, the profitability of current assets depends on the profitability of sales and on the turnover of this part of the assets. By using the methods of chain substitutions or absolute differences, it is easy to identify the factors whose influence is strongest, and then use the results to make the most effective and sound management decisions.
