Performance appraisal

Return on Equity (ROE)

A key investor return calculated as Profit after tax divided by Equity.

Net Profit Margin

A measure of profitability calculated as Profit after tax divided by Revenue.

Financial Leverage Multiplier

A measure of the degree of financial leverage calculated as Capital Employed divided by Equity.

Interest Cover

A ratio that indicates the ability to service debt, calculated as Profit before interest and tax divided by Finance expenses.

Debt-Equity Ratio

A measure of a company's financial leverage, calculated as Total debt divided by Equity.

ROE Decomposition

A method that breaks down Return on Equity into its components: Asset turnover, Financial leverage ratio, and Net profit margin.

Gearing

The proportion of a company's debt to its equity, indicating financial risk.

Profit after tax

The net profit of a company after all expenses, taxes, and costs have been deducted.

Capital Employed

The total amount of capital that a company uses in its operations, which includes equity and debt.

Asset Turnover

A measure of how efficiently a company uses its assets to generate revenue.