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Financial ratio analysis


Financial ratio analysis
Published 23 February 2021
Figure 1: EBITDA profit margin
Financial ratio analysis is used to assess the condition and performance of cement companies based on the performance published in their financial statements, such as their income statement (profit and loss), statement of financial position (balance sheet) and statement of cash flows. Two figures from the financial statements are divided by another to produce a ratio of one to the other. As it is a ratio, the gross profit margin can be compared from period to period, between business units or even between companies. The actual magnitude of the revenue or profit is normalised by the ratio, making such comparisons more meaningful. ....

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