| Ratio Analysis Formula Sheet |
|
| Group 1: Profitability Ratios |
|
| 1- Gross Profit Margin = | Gross Profit | * 100 |
| Sales revenue |
|
| 2- Operating Profit Margin = | Operating Profit | * 100 |
| Sales revenue |
|
| 3- Return on Capital Employed = | Profit before interest and tax | * 100 |
| Capital Employed |
|
| Group 2: Liquidity Ratios |
|
| 1- Current Ratio (Working Capital Ratio) = | Current Assets |
| Current Liabilities |
|
| 2- Acid Test Ratio (Quick Ratio) = | Current Assets – Inventory |
| Current Liabilities |
|
|
| Group 3: Efficiency Ratios |
|
| 1- Inventory Turnover = | Inventory | * 365 days |
| Cost of Sales |
|
| 2- Trade Receivables Turonver = | Trade Receivables | * 365 days |
| Revenue |
|
| 3- Trade Payables Turnover = | Trade Payables | * 365 days |
| Cost of Sales |
|
|
| Group 4: Financial Gearing Ratios |
|
| 1- Gearing Ratio = | Long term debts | * 100 |
| Capital Employed |
|
| 2- Interest Coverage = | Operating Profit |
| Interest Payable |
|
| Group 5: Investor Ratios |
|
| 1- Dividend Payout Ratio = | Dividends announced for the year | * 100 |
| Profit after tax |
|
| 2- Dividend Cover Ratio = | Profit after tax |
| Dividend announced for the year |
|
| 3- Dividend per Share = | Dividend announced for the year |
| Number of ordinary shares in issue |
|
| 4- Dividend Yield Ratio = | Dividend per share | * 100 |
| Market price per share |
|
| 5- Earnings Per Share = | Profit after tax – Preference dividend |
| Number of ordinary shares in issue |
|
| 6- Price Earning (P/E) Ratio = | Market Price per share |
| Earning per share |
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