Page 383 - F2 Integrated Workbook STUDENT 2019

Analysis of financial performance and position

Operating profit margin (OP%)

Operating profit (PBIT)

–––––––––––––––––––––– × 100

Revenue

TUTOR GUIDANCE
Common reasons for movements in OP%:

 If in line with GP% reasons are the same.
 If not in line with GP%, changes caused by movement in operating expenses

e. g:
 redundancies

 marketing costs
 exceptional write off of PPE

 salary savings due to directors leaving posts
 larger delivery networks.

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