Profit marginThe difference between what it costs to produce a product or service and the selling price.
Profit marginOperating profit as a percentage of sales (or turnover). To calculate profit margin, multiply operating profit by 100, and divide the result by turnover.Example: Company X made an operating profit of £500m on a turnover of £3,000m. Profit margin was therefore (500 x 100) / 3000= 16.66%Profit margin tells you about the underlying profitability of a company's trading activities, not whether it is actually making money for shareholders. Note that it is calculated before taking account of interest charges or tax.
Profit marginIndicator of profitability. The ratio of earnings available to stockholders to net sales. Determined by dividing net income by revenue for the same 12-month period. Result is shown as a percentage. Also known as net profit margin.
Net profit before tax (pre tax profit)Net profit before tax (pre tax profit)
The net profits of a company before they are reduced by Corporation Tax.
Profit maximizingProfit maximizing
The level of a variable or behavior that maximizes the profit of a firm.
Excess profits taxExcess profits tax
Additional federal taxes placed on the earnings of a business, used only in time of national emergency such as war.
Unitised with profit endowmentUnitised with profit endowment
This is a hybrid unit-linked endowment, designed to smooth out price fluctuations that occur with unit-linked policies. The value of units is declared each year and that value is then guaranteed. The guaranteed value that is declared is at a discount to the actual value of the units. The guaranteed value will not reach the real value until the term of the endowment is up, so the chance of being able to pay of the loan early is minimised.
Net profitNet profit
The gross profit of a company (total turnover of products sold less costs to purchase or manufacture) less all other expenses. When net profit figures are quoted, the author usually makes it clear whether the figure is before or after tax. In company accounts, the word 'net' is often dropped, so that you simply have 'Profit before tax' and Profit after tax'.
Further SuggestionsBook profit
Risk adjusted profitability
Realized profit (or loss)
Profit sharing plan
unitised with profits
profit and loss statement (P&L)
Accumulated profits tax
pre tax profit
profit before tax
Operating profit margin
Net profit margin