Lists of Ratios Profitability Gross profit Margin Gross profit/sales x 100 (%) Net profit margin or Operating profit

margin Operating profit/sales x 100 (%) ROCE PAT/capital employed x 100 (%) Capital employed = total equity + long term borrowings EBIT/ Capital employed x 100 (%) Capital employed = total equity EBIT = PBT + financing costs financing income Liquidity Current Ratio = Current assets: current liabilities Acid test ratio = (Current assets- inventories): current liabilities Financial or Activity ratio Stock Turnover Cost of sales/inventories (times) Assets turnover Sales/net assets () Net assets = Total assets-current liabilities Stock Holding period Inventories /Cost of sales x 365 (days) Receivables collection period Trade receivables /sales x 365 (days) Payables payment period Trade payables/Cost of sales x 365 (days) Use of Assets Sales/capital employed () Capital employed same as the one used for ROCE Gearing Total debt/ capital employed x 100 (%) Capital employed is total funding = total equity + total debt Total debt not only long term borrowing (more broad definition of debt) Total debt is long-term borrowing, finance lease, non-controlling interest and preference shares Investment ratios Earnings per share (EPS) Profit attributable to equity shareholders / no. Of ordinary shares (pence) Dividend cover Profit attributable to equity shareholders / dividend paid to equity shareholders (times) Dividend yield Annual dividend per share/market price per share x 100 (%) Price earnings ratio (P/E ratio) Market price per share/earnings per share