Wesfarmers Financial Analysis

• Net profit margin has been negative and no major patterns over the 9 year period on net profit since the trend of the industry is based mostly on economic factors, and whether or not they secure contracts. Due to high percentage of COGS they are only left with a net profit of $980 or

The gross profit margin measures the amount of profits that a company generates from its operations without consideration of its indirect costs. Thehigher thegross profit margin, the greater the efficiency of a company’s operations (Besley & Brigham 2007). It means that the company is generating enough income to cover its operating expenses. On the contrary, a lower gross profit margin indicates that the business is not generating adequate income to cover its operating expenses.

A typical Gross profit margin depending on the industry may be 25 to 30%. Nucor’s Gross profit margin ratio indicates that industry is intense and cost of goods is one of the main of factor in profitability. After examining the five year

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Gross profit is defined as the difference between Sales and Cost of Sales. The gross margin (or gross profit ratio) expresses the gross profit as a proportion of net sales. The gross profit margin ratio measures how efficiently a company uses its resources, materials, and labour in the production process by showing the percentage of net sales remaining after subtracting the cost of making and selling a product or service. It indicates the profitability of a business before overhead costs. The higher the percentage, the more the business retains of each dollar of sales. So: the higher the gross profit margin ratio, the better.

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During the last two quarters of 1999-2000, the company has experienced increasing revenues but profit margin contraction. There is insufficient information disclosure in the financials to source the driving factor. However, the largest driver of sales is through its distributors and Bonny Doon’s EuroDoon products (Figure 2). From a P/L standpoint, we believe that the margin fluctuations can be ignored, with a view of focusing on strategic initiatives to maximize revenue and the quantity sold.

The gross margin ratio is a shorter version of the return on sales ratio as it only contains Gross Profit and Sales. WoolEx Mills’ gross margin was 0.14, 0.15, and 0.15 for 2009, 2010, and 2011 respectively. The slight increase over the three-period represented the company’s difficulty to attract new customers and its expenses were not cost effective (Krishnan & Shah 2015) (Kokemuller

Another important ratio to look at is the Return on Equity (ROE), which measures how profitable a company is by showing how much profit a company has earned with money its shareholders have invested.

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The Net Profit Margin expresses the net after tax profits of an organisation as a percentage of sales (Titan, 2012, p. 155). The net profit margin for Wesfarmers and Woolworths is computed as follows in Table III below:

This makes the company look good and they can afford to do this from good financial skills. Decisions like this make a good profit in the long run and all in all this is why it is so important to have a good management team.

Gross Profit is the amount of money left after the Cost of Goods sold have been. Gross Profit is when the business calculate before tax by taking away the Cost of Sales from the Net Sale. The formula for Gross Profit is (Gross Profit for the year divided it by Sales for the year times 100). This ratio shows the business how much profit they are making and it helps to compare the figures from the previous performance. However, the business should be aware that if the percentage decreases from the previous performance then they should investigate the reason behind it. If the Gross percentage decreases from one year to the

As the goal of your portfolio is to provide an income for you, we must view the profitability of the company. The most current Operating Margin also known as the Profit Margin for Exelon is 15.60% which measures the percent of revenues remaining after paying all operating expenses. It is calculated as Operating Income divided by the Total Revenue, multiplied by 100. Operating Margin is a ratio used to measure a company 's operating efficiency. Operating margin suggests how much a company makes (before interest and taxes) on each dollar of sales. The higher a company’s Operating Margin is the better off the company is. Exelon most current Net Profit Margin also known as Return on Sales is 8.61%. This value is the Income after taxes divided by Total Revenue for the same period which is expressed as a percentage. This is the measure that businesses use to report their profitability. A company that is growing its net earnings or reducing its costs is said to be "improving. It’s expressed as the “bottom line.” The bottom line also refers to any actions that may increase or decrease net earnings or a company 's overall profit.

Interpretation-Nz transport has higher profit margin in comparison to industry margin.IN 2012,The gross profit margin is down in comparison to year 2011.becuase of sales are come down .gross profit margin is calculated the profitability ratio which measure how much revenue after paying the cost of good sold.