Analysis of enterprise profitability indicators. Course work "analysis of the profitability of an enterprise using the example of JSC Komsomolets Plant" Enterprise profitability analysis and management

21.11.2023

Essence, meaning and functions of profitability. Characteristics of the economic activities and financial condition of the organization LLC "RUMB". Analysis of indicators of return on equity capital of an enterprise, characterizing the effectiveness of its activities.

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Introduction

2.3 Analysis of profitability indicators of RUMB LLC

Conclusion

Introduction

As is known, the immediate result of the commercial activity of an enterprise is profit, but it often approximately reflects the effectiveness of business activity. Profitability provides a more accurate assessment of the functioning of organizations.

This is not just a statistical, calculated parameter, but a complex comprehensive socio-economic criterion. Unlike profit, it characterizes the efficiency of the financial activities of any specific economic entity, relative to all others (individual entrepreneurs, organizations, regions, individual countries and the world as a whole), regardless of the size and nature of economic activity

The topic of the course work is relevant because profitability occupies an important place in the system of economic categories. It is an indispensable condition for individual reproduction and reproduction on the scale of the entire society

The purpose of the course work is to analyze the profitability of the enterprise LLC "RUMB"

Based on the formulated goals, we will consider the assigned tasks:

1) Study the essence and meaning of enterprise profitability

2) Consider the system of profitability indicators: types and methods of analysis

3) Give a general description of the activities of LLC "RUMB"

4) Conduct an analysis of the dynamics of return on equity indicators of RUMB LLC

5) Consider the factor analysis of the return on equity of RUMB LLC

Object of study - LLC "RUMB"

The subject is the cause-and-effect relationship between profitability indicators and the factors that influenced their change.

To write a course project on the topic of analyzing the profitability of an enterprise using the example of RUMB LLC, various teaching aids, statistical and reference materials, and information sources of the company were used: “Balance Sheet of the Enterprise”, “Profit and Loss Statement”, “Capital Flow Statement” and etc.

profitability financial capital

1. Theoretical foundations for analyzing enterprise profitability indicators

1.1 The essence and significance of enterprise profitability

Profitability is a general indicator characterizing the quality of work of an industrial enterprise

An enterprise that makes a profit is considered profitable. One more concept of profitability can be cited: profitability is an indicator representing the ratio of profit to the amount of production costs, monetary investments in organizing commercial operations, or the amount of property of the company used to organize its activities.

Either way, profitability is the ratio of income to the capital invested in creating that income. By relating profit to invested capital, profitability compares the level of profitability of an enterprise with alternative uses of capital or the return obtained by the enterprise under similar risk conditions.

In the broadest sense of the word, the concept of profitability means profitability, profitability. An enterprise is considered profitable if the results from the sale of products (works, services) cover the costs of production (circulation) and, in addition, form an amount of profit sufficient for the normal functioning of the enterprise.

But the definition of profitability as profitability does not accurately reveal its economic content due to the lack of identity between them, because the amount of profit and the level of profitability, as a rule, do not change in equal proportions, and often in different directions.

So, profitability is a coefficient obtained as the ratio of profit to costs, where the value of balance sheet profit, net profit, profit from sales of products, as well as profit from various types of activities of the enterprise can be used as profit. In the denominator, as costs, indicators of the cost of fixed and working capital, sales revenue, cost of production of equity and borrowed capital, etc. can be used.

Profitability is divided as general - the percentage ratio of balance sheet (total) profit to the average annual total cost of production fixed assets and standardized working capital; and estimated profitability - the ratio of estimated profit to the average annual cost of those production assets from which payment for the assets is charged. An indicator of the level of profitability to current costs is also used - the ratio of profit to the cost of commercial or sold products

Each enterprise independently carries out its production and economic activities on the principles of self-sufficiency and profitability. The enterprise has certain costs for the manufacture of products and their sale. These costs represent the production costs of a given enterprise (cost price), or individual costs. However, the costs of an individual product for enterprises may deviate from the average costs for the industry, which are taken as socially necessary costs or value, the monetary value of which is the price of the product. The presence of individual costs gives rise to the isolation of another part of the cost of production - profit, and, consequently, its relative measurement - profitability.

However, the absolute value of profit does not provide an idea of the level and changes in the efficiency of production or trade. The amount of profit may increase, but production efficiency may remain the same or even decrease. This happens if the increase in profit is obtained due to extensive (quantitative) factors of production - an increase in the number of employees, an increase in the equipment fleet, etc.

If, as the number of workers increases, their productivity remains the same or decreases, then production efficiency accordingly does not change or even decreases. The main distinctive features of profitability in the system of trade and industrial relations are the following:

· the ratio of profit to production costs, characterizing the level of profitability of current costs (for the purchase of raw materials, materials, fuel, for depreciation of labor instruments, expenses for management and maintenance of production and wages of workers);

· the ratio of profit to the average annual cost of production assets, characterizing the relative size of the increase in advance costs and assessing the economic efficiency of production assets.

The real meaning is given by the indicators of profitability, which characterize the efficiency of costs based on the profit received after implementation.

The distribution function of profitability is specifically manifested in the fact that its value is one of the main criteria for the distribution of part of the surplus product - profit.

The level of profitability of socialist associations, enterprises and industries is not determined by the law of the average rate of profit, but is established by the state in a planned manner, taking into account the price level and cost of production, the need for funds for the development of production, and economic incentives for workers of enterprises and associations.

1.2 System of profitability indicators: types and methods of analysis

Profitability indicators characterize the financial results and efficiency of the enterprise. They measure the profitability of an enterprise from various positions and are grouped in accordance with the interests of participants in the economic process and market exchange.

Profitability indicators are important characteristics of the factor environment for generating enterprise profits. Therefore, they are mandatory when conducting a comparative analysis and assessing the financial condition of an enterprise. When analyzing production, profitability indicators are used as a tool for investment policy and pricing

The main profitability indicators can be combined into the following groups

1) indicators of return on capital (assets),

2) product profitability indicators;

3) indicators calculated on the basis of cash flows.

The first group of profitability indicators is formed as a ratio

profit to various indicators of advanced funds, of which the most important are; all assets of the enterprise; investment capital (equity + long-term liabilities); share (equity) capital:

The discrepancy between the levels and profitability of these indicators characterizes the degree to which the enterprise uses financial levers to increase profitability: long-term loans and other borrowed funds.

These indicators are specific in that they meet the interests of all business participants of the enterprise. For example, the administration of an enterprise is interested in the return (profitability) of all assets (total capital); potential investors and creditors - return on invested capital; owners and founders - profitability of shares, etc.

Each of the listed indicators can be easily modeled using factor dependencies. Consider the following obvious relationship:

This formula reveals the relationship between the profitability of all assets.

profitability of sales and asset turnover. Economically, the connection is that the formula directly indicates ways to increase profitability when the return on sales is low, it is necessary to strive to accelerate asset turnover.

Let's consider another factor model of profitability.

As we can see, the return on equity (shareholder) capital depends on changes in the level of profitability of products, the rate of turnover of total capital and the ratio of equity and debt capital. Study. Such dependencies are of great importance for assessing the influence of various factors on profitability indicators. From the given dependence. It follows that, other things being equal, the return on equity capital increases with an increase in the share of borrowed funds in the total capital.

The second group of indicators is formed on the basis of calculating the levels and profitability of profit indicators reflected in the reporting of enterprises.

For example,

These indicators characterize the profitability of products of the base () and reporting () periods. For example, product profitability based on sales profit

where - - profit from sales of the reporting and base periods;

Sales of products (works, services) of the reporting and base periods;

Cost of products (works, services) of the reporting and base periods;

Change in profitability in the reporting period compared to the base period.

The influence of the factor of change in sales volume is determined by calculation (using the method of chain substitutions)

Accordingly, the impact of a change in cost will be

The sum of factor deviations gives the overall change in profitability in the reporting period compared to the base period;

The third group of profitability indicators is formed similarly to the first and second groups, however, instead of profit, net cash inflow is taken into account.

NPV - net cash inflow

These indicators give an idea of the extent to which an enterprise can pay creditors, borrowers and shareholders with cash in connection with the use of existing cash inflows. The concept of profitability calculated on the basis of cash flow is widely used in countries with developed market economies. It is a priority because cash flow operations that ensure solvency are an essential sign of the state of the enterprise.

1.3 Goals, objectives and information base for assessing the effectiveness of the enterprise’s activities

The information support of the analysis reflects the entire set of simultaneously or sequentially performed operations that cause the process of accelerating development in enterprises of economic activity. According to its role in the management process, information is divided into documentation and reporting information.

The documentation includes annual plans, quarterly, monthly plans for both the enterprise as a whole and its individual divisions. Reporting information is contained in primary accounting documents. At the enterprise, there are three types of accounting: operational, statistical, accounting. Operational accounting is characterized by urgency and speed of obtaining information, a relatively small number of indicators taken into account, used for prompt intervention in the production process in order to eliminate detected deficiencies and their causes. Accounting is a system of continuous, continuous and strictly documented reflection in monetary terms of the economic activities of an enterprise, the movement of funds, the sources of their formation and the results of work. Statistical accounting consists of obtaining and analyzing indicators that comprehensively characterize the activities of an enterprise and are presented in forms (forms) of statistical reporting. Statistical reporting is based on accounting data. Statistical reporting is submitted annually to the city statistical department in the form of 2 and 3 forms of the enterprise’s balance sheet. The following indicators are calculated: indicators for labor and wages, indicators for fixed assets, indicators for the distribution of finances. Reporting data is sent to the state Central Statistical Office, which publishes the results in the form of statistical tables.

The annual reporting includes a balance sheet (Form No. 1), a profit and loss statement (Form No. 2), explanations to the balance sheet and income statement, a capital flow statement (Form No. 3), a cash flow statement, an appendix to the balance sheet, explanatory note, final part of the auditor's report.

The source materials for analysis of implementation are “Report on the availability and movement of fixed assets”, “Profits and losses”. “Balance sheet of the enterprise”, etc.

2. Comprehensive assessment of profitability indicators of the company RUMB LLC

2.1 General characteristics of the activities of RUMB LLC

The RUMB organization traces its history back to the RUMB Municipal Enterprise, created in 1995. But the enterprise was closed and soon a new organization, RUMB LLC, appeared on the geodetic services market.

Full name: Limited Liability Company "RUMB";

Abbreviated name: LLC "RUMB".

Legal address of LLC "RUMB": Krasnogorsk, st. Shkolnaya 7

Office location - Krasnogorsk. The number of full-time employees is 48 people.

The main activity of LLC "RUMB":

1. Topographic and geodetic survey, including search and coordination of the correct display of underground communications, engineering-geological and environmental surveys, tree-by-tree survey and dendrological examination;

2. Urban planning: participation in the development of master plans and planning projects, participation in the development of land use and development rules, development of territory surveying projects and urban planning plans for land plots, schemes for the planning organization of land plots, preparation and coordination of selection acts;

3. Cadastral activity: description of real estate objects in order to clarify and create new ones, including through division and merger, in order to impose restrictions on use;

Region of activity: Moscow and Moscow region.

An analysis of the dynamics of the main indicators of the financial and economic activities of RUMB LLC, presented in Tables 1 and 2, indicates an increase in the activity of the organization in 2011 compared to 2010-09.

Table 1

Data on the company's property and liabilities for 2009-2011.

The name of indicators

Initial OS cost
Cost of current assets	RUB 11,368,562.24	20,495,311.11 rub.
Accounts receivable		RUB 13,386,646.59
Total Asset Value	11,523,008.32 rub.	RUB 20,573,585.38
Capital and reserves		RUB 11,471,591.18
long term duties
Credit debt

Table 2.

Main performance indicators of LLC "RUMB" for 2010-2011.

The name of indicators

Revenues from sales	RUB 34,925,167.20	RUB 57,401,058.60
Cost of sales	25,736,518.45 rub.	RUB 32,947,476.43
Gross profit		RUB 24,453,582.17
Revenue from sales		RUB 24,453,582.17
Other income
other expenses
Current income tax.
Net income (loss)		22,755,311.91 rub.
Total financial result of the period		22,755,311.91 rub.

Sales revenue amounted to 57,401,058.60 rubles, with a cost of 32,947,476.43 rubles. The organization's net profit amounted to 22,755,311.91 rubles. (See Fig.1)

Rice. 1. Dynamics of main economic indicators.

A general assessment of the performance efficiency and dynamic development of a company can be given based on a comparison of the growth rates of profit, revenue and capital advanced into its activities.

The following ratio is considered optimal:

TPR > TVR > TA > 100%,

where TPR, TVR, TA are the rates of change in profit from sales, proceeds from sales and value of assets.

The rate of change in profit from sales, proceeds from sales and value of assets is:

TPR = (24453582.17/9188648.75)*100%= 266.13%

TVR = (57401058.6. / 34925167.2.)*100% = 164.35%

TA = (RUR 20,475,311 / RUR 11,368,562.24)*100% =180.1%

Let's analyze the results:

The resulting ratio:

TPR > TVR > TA > 100%

266,13 % > 164,35%< 180,1 %- > 100%

With an increase in the value of current assets by 80.10%, sales revenue increased by 64.35%, and profit from sales increased by 166.13%. This indicates the overall efficiency of the company and improved development dynamics. Although the organization is developing dynamically, the optimal ratio has not been achieved, since profit, although growing at a faster pace than revenue growth, is less than the growth in asset value. This indicates that the company's resources are not being used effectively.

Let's analyze the effectiveness of activities based on labor productivity.

PT = TP (BP) / Chr.sr.,

where TP (VR) is the volume of marketable products (sales revenue);

Black avg. -- average number of employees.

Labor productivity in the organization for the reporting year is:

PT VR report. = 57,401,058.6/ 48 people. = 1,195,855.39 rub.

PT VR past. = 34925167.2 / 35 people = 997,861.92 rub.

Increase in labor productivity when calculated based on sales revenue by 197,993.47 rubles. determines the positive dynamics of the organization's development.

Capital productivity characterizes the efficiency of using fixed assets. It is determined by the volume of production (sales) per ruble of fixed assets and is calculated using the formula:

Fo = TP (BP) / SOS avg.(? 1000),

where SOS is the replacement cost of fixed assets (annual average or at the end of the year).

Capital productivity (based on sales revenue and average annual cost of fixed assets) for the reporting year is:

Fo report. = 33916579.86 rub. / ((98,274.27 rub. + 154,446.08 rub.)/2)*1000 = 268,411.94 rub.

268411.94 rub. - the volume of sales of services in rubles per 1 thousand rubles. fixed assets.

Let's consider the costs per 1 rub. sold products (services) characterize the amount of costs for production of products and are calculated using the formula:

Z 1r.TP (RP) = ZTP (SRP) / TP(VR) (? 1000),

where ZTP is the amount of costs for the production of marketable products;

PSA is the cost of goods sold.

Cost per 1 rub. products sold in the reporting year amounted to: Z 1r.TP (RP) = 32947476.43 / 57401058.6r. = 0.574 rub.

Cost per 1 rub. commodity (sold) products must be less than a ruble, otherwise the company will not make a profit.

2.2 Assessment of the financial condition of the organization

We will conduct a general analysis of the financial condition, for this we will draw up a comparative analytical balance

Based on the results of compiling the balance sheet, we can conclude that there is excellent dynamics of asset growth; assets grew 1.8 times over the year from 7088664.52 to 13386646.59 rubles.

Table 3

Calculation and assessment of financial condition ratios.

Index	Normative value	Meaning
General solvency indicator	Standard value 1
Absolute liquidity ratio	Range 0.1 to 0.7
"Critical" rating coefficient
Current ratio	Range from 1-2, optimal. Value from 1.5 to 2
Coef. maneuverability of operating capital	In dynamics, the indicator should decrease
Share of working capital in assets
Equity backed ratio	no less than o.1

Let's analyze the financial stability of the organization:

1. Capitalization ratio = (DO + KO)/KiR = 0.79

The capitalization ratio shows how much borrowed funds the company has attracted per 1 ruble of its own funds invested in assets (the normative value of the ratio should not be higher than 1.5). The calculated coefficient is 0.79, which means for 1 ruble of equity capital invested in assets there are 0.79 borrowed funds.

2. Coefficient of provision with own sources of financing = (C&R + VO) / OA = 0.56

The coefficient of provision with own sources of financing shows that 0.56 current assets are financed from own sources. The standard value is not lower than 0.5.

3. Financial independence ratio = 0.55

The financial independence coefficient shows that the share of own funds in the total amount of financing sources is 0.55. The standard value is not less than 0.4.

4. Funding ratio

Kf = sob.k. / (Debt + short-term liabilities) = 1.26

The financing ratio shows to what extent the enterprise's assets are formed from its own capital, and to what extent the enterprise is independent of external sources of financing. The standard indicator is not less than 0.7. The financing ratio is greater than one, the conclusion is that most of the property was formed not at the expense of borrowed funds, but at the expense of one’s own.

5. Financial stability ratio

K f.u. = Kir/ (Debt. liabilities - losses) = 0.55

Shows what part of the assets is financed from own funds, not less than 0.6.

Let us summarize the results of the analysis of financial stability: the financial condition of the enterprise can be characterized as - normal financial condition, because Inventories and costs are secured by our own working capital and long-term liabilities.

2.3 Analysis of enterprise profitability indicators

The goal of a commercial organization is profit, which is accordingly the most important object of economic analysis. However, the absolute amount of profit cannot characterize the efficiency of the enterprise's use of its resources. And as already mentioned in the first chapter, one of the main indicators characterizing the efficiency of an enterprise is profitability. Profitability, in a general sense, characterizes the feasibility of expended resources in relation to newly created resources (profit).

Profitability is an indicator that comprehensively characterizes the efficiency of an enterprise. With its help, you can evaluate the effectiveness of enterprise management, since obtaining high profits and a sufficient level of profitability largely depends on the correctness and rationality of management decisions made. Therefore, profitability is often considered as one of the criteria for management quality.

Profitability indicators characterize the efficiency of the enterprise as a whole, the profitability of various areas of activity (production, business, investment), cost recovery, etc. They characterize the final results of business more fully than profit, because their value shows the relationship between the effect and the available or used resources.

1. Return on assets = net profit / average value of all assets of the organization, balance sheet currency

P = 22755311.91 / 20573585.38 = 1.104

Shows the ability of assets to generate profit.

Return on assets (economic return on assets) shows how much profit there is for each ruble invested in the organization's property.

2. Return on equity = Net profit / average equity value

P = 22755311.91 / 11471591.18 = 1.99

From an owner's perspective, profitability is best expressed as return on equity and is most important to a company's shareholders. Since it characterizes the profit that the owner will receive from the ruble of funds invested in the enterprise.

From one ruble invested in an enterprise, the owner will receive 1.99 rubles.

3. Return on authorized capital = Net profit / average amount of authorized capital

P = 22,755,311.91 / 10000 = 2275.1

Return on authorized capital characterizes the efficiency of use of authorized capital and shows how much net profit falls on one ruble of authorized capital. One ruble of authorized capital accounts for 2275.1 rubles of net profit.

4. Asset return ratio = Revenue (net) from the sale of goods, services (B) / average value of all assets of the organization

P = 59401058.6 / 20573585.38 = 2.88

This indicator is often called asset turnover or a characteristic of business activity. The asset turnover ratio characterizes the efficiency of the company's use of all available resources, regardless of the sources of their attraction.

5. Profitability of costs for goods, products, works, services sold = Profit from sales / total cost of goods, works, services sold.

P = 24453582.17 / 32947476.43 = 0.74

Reflects the amount of profit per unit of total costs and characterizes the efficiency of current resource costs for production and sales.

Per unit of total costs is 0.74 rubles. arrived.

6. Return on sales = Profit from sales / revenue from the sale of goods, services

P = 24453582.17 / 59401058.6 = 0.41

Reflects the amount of financial result per unit of sales volume and characterizes the level of profitability of sales.

Per unit of sales volume accounts for 0.41 rubles. arrived.

7. Costs per 1 ruble of products sold = Full cost of products sold / revenue from the sale of goods and services

P = 32947476.43 / 59401058.6 = 0.55

Reflects the total cost intensity, i.e. the amount of costs in kopecks for each ruble of sales.

For one ruble of sales there are 0.55 rubles of costs.

In order to increase efficiency, profitability, and competitiveness, I propose the following measures:

1. Develop a policy for working with clients and carry out a set of measures aimed at increasing the level of consumer satisfaction with services, the goal of which is to win a permanent client base.

2. Based on the introduction of new technologies, constantly work to improve the quality of customer service.

As an example of an event to improve financial and economic activities, let’s consider an event to introduce computer diagnostics services in the provision of topographic and geodetic services.

The main “advantages” of introducing computer diagnostics:

· promptly and with great accuracy shows the entire infrastructure of engineering and other structures under study, makes complex calculations on soil density, determination of its components, including testing the ecology of the components of the soil and environment;

· improves the quality of work, which allows you to increase the price of services

Increases trust in the service, which leads to an increase in the volume of services

Firms that have implemented a full cycle of computer diagnostics, according to statistics, increased their annual income by 10.5%.

To introduce this service, you must purchase equipment for computer diagnostics. There are many types of computer installations on the market, but the leader in quality is the installation of the brand Production and Geodetic Department of JSC NPK GeoYug. The cost of such an installation is from 850,000.00 rubles to 1,200,000.00 rubles per set. The price depends on configuration. It was decided to purchase two sets of this equipment. For this it is necessary to allocate 2,400,000 rubles.

The founders of RUMB LLC are ready to increase the authorized fund by the amount of purchase of this equipment. Let's consider the company's revenue from the introduction of a new service. (See Table 4).

Table 4. Calculation of revenue from the introduction of computer topographic diagnostics services (per 1 set) at RUMB LLC

Table 5. Costs of introducing computer topographic diagnostics services at RUMB LLC

So, the cost of implementation and maintenance of two sets of computer topographic diagnostics will amount to 11,160 thousand rubles.

Revenue from the services of this equipment will be equal to 25,350 thousand rubles.

Let us present the efficiency indicators for the implementation of topographic computer diagnostics at RUMB LLC in Table 6 and Figure 2.

Table 6. Efficiency indicators for the implementation of computer diagnostics at RUMB LLC for 2012 (forecast) (thousand rubles)

Fig. 2 - Efficiency indicators for the implementation of computer diagnostics at RUMB LLC for 2012 (forecast) (thousand rubles)

Thus, calculations show that the event is beneficial to the enterprise, the introduction of a new service has a high return on sales and can be recommended for implementation.

Dynamics of the main technical and economic performance indicators at RUMB LLC after the introduction of topographic computer diagnostics services.

Table 7. Results from measures to enhance marketing activities.

From the table we see that the return on sales is 37%. Also 63% are the costs of the project to enhance marketing activities. Since the variables are 2.2% (bonuses for active sales managers 1% + media promotion costs 1.2%)

Table 8. Results of the activities of the enterprise LLC "RUMB" after the implementation of planned projects.

Indicators	Before the event	After the event	Deviations (+/-) in absolute values (rubles)	Deviations (+/-) in relative values (%)
Cost price
Gross profit
Net profit
Fixed assets
Average headcount
Performance
Net profitability
Profitability of services
Cost intensity of services

Profitability ratios show positive dynamics from planned activities. Thus, the profitability of services increased by 3%. Net profitability increased by 2% and amounts to 41.7%. Product cost intensity decreased by 4% from 0.57 to 0.53 coefficient.

All this characterizes productive and cost-effective planned activities.

Conclusion

A market economy requires an enterprise to increase production efficiency, the competitiveness of products and services based on the introduction of scientific and technological progress, effective forms of business and production management, overcoming mismanagement, intensifying entrepreneurship, initiative, etc.

An important role in the implementation of this task is given to the analysis of the financial and economic activities of enterprises. With its help, strategies and tactics for the development of the enterprise are developed, plans and management decisions are substantiated, their implementation is monitored, reserves for increasing production efficiency are identified, and the results of the activities of the enterprise, its divisions and employees are assessed.

The task of economic analysis of profitability is to identify the influence of external factors, determine the amount of profit received as a result of the action of the main internal factors, reflecting the labor investments of workers and the efficiency of use.

All expedient human activity, one way or another, is connected with the problem of efficiency. This concept is based on limited resources, the desire to save time, and obtain as much product as possible.

The level of efficiency influences the solution of a number of social and economic problems, such as rapid economic growth and improving the standard of living of the population.

Since an event was proposed to introduce the service of topographic computer diagnostics. As calculations have shown, the enterprise, through the introduction of topographic computer diagnostics services, will be able to increase the enterprise’s revenue by 44% or by 25,350 thousand rubles. At the same time, the cost will increase by 11,160 thousand rubles. or by 33%. The growth rate of cost is lower than the growth rate of revenue, which will lead to an increase in gross profit by 14,190 thousand rubles. or by 58.03%. The increase in net profit will be 11,060 thousand rubles. or by 48.6%. Profit growth will lead to an increase in the profitability of services from 42.6% to 46.7%, that is, by 4%.

Thus, the proposed measures will improve the economic performance of the enterprise and can be recommended for implementation

List of sources used

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3. Dybal S.V. Financial analysis: theory and practice: Textbook. - St. Petersburg: Publishing House "Business Press", 2006. - 148 p.

4. Kolchina L.M. Enterprise finance: textbook for universities, 3rd ed. reworked - M.: UNITY - DANA, 2007. - 447 pp.

5. Podyablonskaya L.M. Financial stability and assessment of enterprise insolvency: /L.M. Podyablonskaya // Finance. - 2010. - No. 12. - P. 18 - 20.

6. Pyastolov S.M. Economic analysis of enterprise activity [Text]: textbook / S.M. Piastolov. - M.: Academic Project, 2010. - 576 p.

7. Rudak, N.A., Strazhev V.I., Migun O.F. and others. Analysis of economic activity: - M.: Vyssh. school, 2002, 398 p.

8. Savitskaya, G.V. Analysis of the economic activity of the enterprise: Mn.: IP Ecoperspective, 2003, p. 235

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Estimation of enterprise profit

The profit of an enterprise is an absolute indicator, therefore the presence, size and even growth of profit cannot provide complete information about the efficiency of business.

Analysis of the profit and profitability of an enterprise can be external and carried out by investors, auditors and creditors to assess the financial condition of the enterprise, and internal and carried out for the purposes of planning, operational management and strategic decision-making. A comparison of planned results with those actually obtained can also be carried out.

According to the methodology for conducting profit analysis, the following types of analysis are distinguished:

structural;
factorial;
dynamic;
index;
comparative.

Structural profit analysis

Determining the profit structure of an enterprise allows you to analyze the share of the total profit from the main and other activities.

A change in the profit structure may indicate shifts in the profitability of core activities. An increase in the share of other operations in the amount of profit generated, even with an increase in absolute profit values, indicates a decrease in the efficiency of doing business in the chosen area.

The indicator of net profit generated will mean what amount of net profit turns into 1 ruble of profit received, which can determine the most profitable positions in the structure of total sales at the moment.

In the structural analysis of profit, one can also highlight the territorial feature:

In the structure of profit from sales, it is also possible to distinguish shares for long-term contracts and single transactions, which allows us to assess the quality of the customer base.

Factor analysis of profit

Factor analysis involves studying the influence of various factors on profit:

cost of goods or services;
labor costs;
sales volumes;
prices for goods and services of the organization.

Any of the analyzed types of profit can be used as a base, for example:

The value of the indicator will determine the extent to which a change in gross (net, balance sheet) profit occurs when revenue (cost, payroll, price) changes by one ruble.

Dynamic profit analysis

Dynamic profit analysis involves measuring the growth rates of various types of profit and comparing them with each other.

Important information is given here:

analysis of growth rates of the same type of profit for different periods,
comparison of rates of change of different types of profit.

If the growth rate of balance sheet profit exceeds the growth rate of operating profit or they move in different directions, this will mean that the structure of the enterprise’s profit is unbalanced.

Index analysis

Index analysis allows us to establish trends in constancy or imbalance in growth rates or increases in types of profit, as well as seasonality.

In basic analysis, all indicators are reduced to one basic denominator, in chain analysis - sequentially one to another, for example:

Profit Benchmarking

A comparative analysis of profit and profitability in order to determine the efficiency of an enterprise in comparison with other business entities involves a comparison of various types of profit of the enterprise:

with the industry profit rate;
with similar indicators of competitors, leading players;
in related areas of business.

Enterprise profitability analysis

Profitability is a relative indicator characterizing the level of profitability of an enterprise.

A comparison of profitability indicators for different periods makes it possible to analyze the dynamics of the efficiency of an enterprise's use of the funds and investments that it has, and the ability of the enterprise's resources to generate profit.

Profitability is calculated as a coefficient that generally demonstrates how many percent of profit is extracted from one ruble of resources.

There are profitability of products, production, assets, capital.

Product profitability is calculated using the formula.

Profitability- a relative indicator of economic efficiency. The profitability of an enterprise comprehensively reflects the degree of efficiency in the use of material, labor, monetary and other resources. The profitability ratio is calculated as the ratio of profit to the assets or flows that form it.

In a general sense, product profitability implies that the production and sale of a given product brings profit to the enterprise. Unprofitable production is production that does not make a profit. Negative profitability is an unprofitable activity. The level of profitability is determined using relative indicators - coefficients. Profitability indicators can be divided into two groups (two types): and return on assets.

Return on sales

Return on sales is a profitability ratio that shows the share of profit in each ruble earned. It is usually calculated as the ratio of net profit (profit after tax) for a certain period to the sales volume expressed in cash for the same period. Profitability formula:

Return on Sales = Net Profit / Revenue

Return on sales is an indicator of a company's pricing policy and its ability to control costs. Differences in competitive strategies and product lines cause significant variation in return on sales values across companies. Often used to evaluate the operating efficiency of companies.

In addition to the above calculation (return on sales by gross profit; English: Gross Margin, Sales margin, Operating Margin), there are other variations in calculating the return on sales indicator, but to calculate all of them, only data on the profits (losses) of the organization are used (i.e. e. data from Form No. 2 “Profit and Loss Statement”, without affecting the Balance Sheet data). For example:

return on sales (the amount of profit from sales before interest and taxes in each ruble of revenue).
return on sales based on net profit (net profit per ruble of sales revenue (English: Profit Margin, Net Profit Margin).
profit from sales per ruble invested in the production and sale of products (works, services).

Return on assets

Unlike indicators of return on sales, return on assets is calculated as the ratio of profit to the average value of the enterprise's assets. Those. the indicator from Form No. 2 “Income Statement” is divided by the average value of the indicator from Form No. 1 “Balance Sheet”. Return on assets, like return on equity, can be considered as one of the indicators of return on investment.

Return on assets (ROA) is a relative indicator of operational efficiency, the quotient of dividing the net profit received for the period by the total assets of the organization for the period. One of the financial ratios is included in the group of profitability ratios. Shows the ability of a company's assets to generate profit.

Return on assets is an indicator of the profitability and efficiency of a company's operations, cleared of the influence of the volume of borrowed funds. It is used to compare enterprises in the same industry and is calculated using the formula:

Where:
Ra—return on assets;
P—profit for the period;
A is the average value of assets for the period.

In addition, the following indicators of the efficiency of using certain types of assets (capital) have become widespread:

Return on equity (ROE) is a relative indicator of operational efficiency, the quotient of dividing the net profit received for the period by the organization’s equity capital. Shows the return on shareholder investment in a given enterprise.

The required level of profitability is achieved through organizational, technical and economic measures. Increasing profitability means getting greater financial results at lower costs. The profitability threshold is the point that separates profitable production from unprofitable ones, the point at which the enterprise’s income covers its variable and semi-fixed costs.

Introduction

1. Economic content of enterprise profitability

1.1. Concept of profitability

1.2. System of profitability indicators

2. Analysis of production profitability indicators using the example of OJSC Komsomolets Plant in Tambov for 2001-2003

Conclusion

List of used literature

Introduction

Currently, with the transition of the economy to market relations, the independence of enterprises and their economic and legal responsibility are increasing. The importance of financial stability of business entities is increasing sharply. All this significantly increases the role of analysis of their financial condition: the availability, placement and use of funds.

A general indicator of the economic efficiency of production is the profitability indicator. Profitability means the profitability of an enterprise. It is calculated by comparing gross income or profit with costs or resources used (2, P.78)

Based on the analysis of average profitability levels, it is possible to determine which types of products and which business units provide greater profitability. This becomes especially important in modern market conditions, where the financial stability of an enterprise depends on the specialization and concentration of production.

The object of this study is OJSC Komsomolets Plant.

Subject - assessment of the profitability of OJSC Komsomolets Plant.

The purpose of writing this work is to study profitability indicators and apply them in financial analysis and planning of enterprise activities, using the financial statements of OJSC Komsomolets Plant.

To achieve this goal, it is necessary to solve the following range of tasks:

Define the concept of profitability, reveal its significance for financial analysis and characterize the main areas of its application;

Consider the system of profitability indicators in accordance with their classification into indicators of profitability of economic activities, financial profitability and indicators of product profitability;

Conduct an analysis of the level and dynamics of profitability of the economic activities of OJSC Komsomolets Plant;

Assess the level and dynamics of profitability of the financial activities of the analyzed enterprise;

Draw the necessary conclusions on the profitability indicators of OJSC Komsomolets Plant.

1. Economic content of enterprise profitability

1.1. Concept of profitability

In the economic literature, several concepts of profitability are given. Thus, one of its definitions is as follows: profitability (from the German rentabel - profitable, profitable) is an indicator of the economic efficiency of production in enterprises, which comprehensively reflects the use of material, labor and monetary resources (8, P.25).

According to other authors, profitability is an indicator that represents the ratio of profit to the amount of production costs, monetary investments in organizing commercial operations, or the amount of company property. Either way, profitability is the ratio of income to the capital invested in creating that income. By relating profit to invested capital, profitability compares the level of profitability of an enterprise with alternative uses of capital or the return obtained by the enterprise under similar risk conditions. Riskier investments require higher returns to become profitable. Since capital always brings profit, to measure the level of profitability, profit, as a reward for risk, is compared with the amount of capital that was necessary to generate this profit. Profitability is an indicator that comprehensively characterizes the efficiency of an enterprise. With its help, you can evaluate the effectiveness of enterprise management, since obtaining high profits and a sufficient level of profitability largely depends on the correctness and rationality of management decisions made. Therefore, profitability can be considered as one of the criteria for management quality.

Based on the level of profitability, one can assess the long-term well-being of the enterprise, i.e. the ability of a business to earn a sufficient return on investment. For long-term creditors of investors who invest money in the equity capital of an enterprise, this indicator is a more reliable indicator than indicators of financial stability and liquidity, determined on the basis of the ratio of individual balance sheet items.

By establishing a connection between the amount of profit and the amount of invested capital, the profitability indicator can be used in the process of forecasting profit. In the forecasting process, the profit expected to be received on these investments is compared with actual and expected investments. The estimate of expected profit is based on the level of profitability for previous periods, taking into account projected changes. In addition, profitability is of great importance for making decisions in the field of investment, planning, budgeting, coordinating, evaluating and monitoring the activities of an enterprise and its results.

Thus, we can conclude that profitability indicators characterize the financial results and efficiency of the enterprise. They measure the profitability of an enterprise from various positions and are systematized in accordance with the interests of participants in the economic process.

Profitability can be of the following types:

a) the overall profitability of associations and enterprises is determined by the ratio of balance sheet profit to the average annual cost of fixed production assets and standardized working capital and is calculated using the formula:

R = P * 100 / OF + ROB (1.3)

P - profit

Of - average annual cost of fixed production assets

About - average annual cost of standardized working capital

b) the actual total profitability is determined by the ratio of book profit to the actual average annual cost of production fixed assets and normalized working capital not financed by the bank. The actual balances of normalized working capital are established based on their balance on the balance sheet minus the debt to suppliers for accepted payment requests, the payment deadline for which has not arrived, and to suppliers for uninvoiced supplies, as well as depreciation of low-value and wear-and-tear items and a reserve for compensation of planned losses and upcoming expenses.

The level of profitability depends not only on the amount of profit, but also on the capital intensity of production. In enterprises of heavy industry associations with high capital intensity of production, the level of profitability in relation to production assets is lower than in associations of light and especially food industry enterprises. With an increase in the amount of profit and a decrease in the cost of fixed production assets and normalized working capital, profitability increases, and vice versa (15, P.98)

c) estimated profitability is the ratio of balance sheet profit minus payment for production assets, fixed payments, interest on a bank loan, profit for special purposes (profit from the sale of consumer goods, new household chemicals, etc. .), as well as profits received for reasons independent of the activities of the association or enterprise, to the average annual cost of fixed assets (minus fixed assets for which payment benefits are provided) and standardized working capital.

When analyzing the work of associations and enterprises, especially when planning to assess the profitability of products, profitability, defined as the ratio of the amount of profit to the total cost of products sold, is important. The profitability of certain types of products is calculated using the formula:

R = (O - C) *100 / C (1.4)

where R is the level of profitability, %

О - enterprise wholesale price for products

C is the total cost of the product.
The profitability indicator for products reflects the efficiency of the costs of living and material labor for the production of products.

In mechanical engineering and other manufacturing industries, profitability is defined as the ratio of profit to cost minus the cost of raw materials used, fuel, energy, materials, semi-finished products and components. The following formula can be used:

Rm = F * Rf / S - M (1.5)

where Rm is the calculated standard of profitability to cost minus material costs

F - industry production assets

Rf - profitability standard for production assets

C - M - cost of commercial products minus direct material costs.

The use of the indicator of standard estimated profitability in manufacturing industries is due to the high share of material costs in the cost of production of these industries, their significant fluctuations in the cost of certain types of products and the wide possibilities for technological replacement of the raw materials used.

If a business makes a profit, it is considered profitable. Profitability indicators used in economic calculations characterize relative profitability (12, P.119)

The effectiveness and economic feasibility of the operation of an enterprise can be assessed using absolute and relative indicators.

Absolute indicators allow you to analyze the dynamics of various profit indicators over a number of years.

Relative indicators are less affected by inflation because represent various ratios of profit and invested capital, or profit and production costs.

It is not always possible to judge the level of profitability of an enterprise by the absolute amount of profit, since its size is influenced not only by the quality of work, but also by the scale of activity. Therefore, to characterize the efficiency of an enterprise, along with the absolute amount of profit, a relative indicator is used - the level of profitability.

It is most appropriate to consider these characteristics in relation to other time periods. Absolute numbers themselves convey little information. Only knowing the dynamics of their changes can one more reliably judge the work of the enterprise.

In the conditions of market relations, the role of product profitability indicators, which characterize the level of profitability (unprofitability) of its production, is great. Profitability indicators are relative characteristics of the financial results and efficiency of the enterprise. They characterize the relative profitability of the enterprise, measured as a percentage of the cost of funds or capital from various positions.

1.2 System of profitability indicators

Profitability indicators are the most important characteristics of the actual environment for generating profit and income of enterprises. For this reason, they are mandatory elements of comparative analysis and assessment of the financial condition of the enterprise. When analyzing production, profitability indicators are used as a tool for investment policy and pricing.

Profitability indicators are important characteristics of the factor environment for generating enterprise profits. Therefore, they are required when conducting a comparative analysis and assessing the financial condition of an enterprise. When analyzing production, profitability indicators are used as a tool for investment policy and pricing

The main profitability indicators can be grouped into the following groups:

1) indicators of return on capital (assets),

2) product profitability indicators;

3) indicators calculated on the basis of cash flows.

The first group of profitability indicators is formed as the ratio of profit to various indicators of advanced funds, of which the most important are; all assets of the enterprise; investment capital (equity + long-term liabilities); share (equity) capital:

Each of the listed indicators can be easily modeled using factor dependencies. Consider the following obvious relationship:

This formula reveals the relationship between the profitability of all assets. profitability of sales and asset turnover. Economically, the connection is that the formula directly indicates ways to increase profitability when the profitability of sales is low, it is necessary to strive to accelerate asset turnover.

Let's consider another factor model of profitability.

As you can see, the return on equity (shareholder) capital depends on changes in the level of profitability of products, the rate of turnover of total capital and the ratio of equity and debt capital. Study. Such dependencies are of great importance for assessing the influence of various factors on profitability indicators. From the given dependence. It follows that, other things being equal, the return on equity capital increases with an increase in the share of borrowed funds in the total capital.

The profitability of an enterprise (total profitability) is defined as the ratio of book profit to average cost. Fixed production assets and standardized working capital. The ratio of the fund to material and equivalent costs reflects the profitability of the enterprise.

The level of overall profitability is a key indicator when analyzing the profitability of an enterprise. But if you want to more accurately determine the development of an organization based on the level of its overall profitability, it is necessary to additionally calculate two more key indicators: return on turnover and the number of capital turnover.

Indicators of profitability and profitability have a general economic characteristic; they reflect the final efficiency of the enterprise and its products. The main indicator of the level of profitability is the ratio of the total amount of profit to production assets.

There are many factors that determine the amount of profit and the level of profitability. These factors can be divided into internal and external. External are factors that do not depend on the efforts of a given team, for example, changes in prices for materials, products, transportation tariffs, depreciation rates, etc. Such events are carried out on a general scale and have a strong impact on the general indicators of production and economic activity of enterprises. Structural changes in the product range significantly affect the amount of products sold, cost and profitability of production.

Profitability (profitability) indicators are general economic indicators. They reflect the final financial result and are reflected in the balance sheet and statements of profit and loss, sales, income and profitability. Profitability can be considered as a result of the influence of technical and economic factors, and therefore as objects of technical and economic analysis, the main goal of which is to identify the quantitative dependence of the final financial results of production and economic activities on the main technical and economic factors.

Profitability is the result of the production process; it is formed under the influence of factors related to increasing the efficiency of working capital, reducing costs and increasing the profitability of products and individual products (9, P.47). The overall profitability of an enterprise must be considered as a function of a number of quantitative indicators - factors: structure and capital productivity of fixed production assets, turnover of standardized working capital, profitability of products sold. This is a different approach to analyzing the profitability of an enterprise. For such an analysis, a modified formula for calculating the overall profitability indicator proposed by A.D. Sheremet is used.

P=(E / 1/UM) + 1/K, where

P - overall profitability of the enterprise %

E - total (balance sheet) profit, % of the volume of sales

products;

Y - the share of the active part in the total cost of the main

production assets, unit shares;

M - capital productivity ratio of the active part of fixed assets

production assets;

K is the turnover ratio of normalized funds.

The second group of indicators is formed on the basis of calculating the levels and profitability of profit indicators reflected in the reporting of enterprises. For example,

These indicators characterize the profitability of products of the base () and reporting () periods. For example, product profitability based on sales profit

where - - profit from sales of the reporting and base periods;

Sales of products (works, services) of the reporting and base periods;

Cost of products (works, services) of the reporting and base periods;

Change in profitability in the reporting period compared to the base period.

The influence of the factor of change in sales volume is determined by calculation (using the method of chain substitutions)

Accordingly, the impact of a change in cost will be

The sum of factor deviations gives the overall change in profitability in the reporting period compared to the base period;

The third group of profitability indicators is formed similarly to the first and second groups, however, instead of profit, net cash inflow is taken into account.

NPV - net cash inflow

2. Analysis of production profitability indicators at OJSC Komsomolets Plant for 2002-2004

2.1. Profitability of production activities of OJSC "Komsomolets"

Profitability indicators characterize the operating efficiency of the Komsomolets OJSC enterprise as a whole, the profitability of production, business, investment activities, and cost recovery. They characterize the final results of business more fully than profit, because their value shows the relationship between the effect and the available or used resources.

Let's consider the dynamics of profitability indicators for the three analyzed years, which are presented in Table 1.1.

Table 1.1

Dynamics of profitability indicators in OJSC

"Komsomolets" for 2002 - 2004, %.

	Indicators				0deviation


	Profit from sales
	Cost of goods sold
	Revenues from sales
	Average annual cost of capital
	Balance sheet profit
	Profitability of production
	Return on sales
	Return on Equity

As noted above, the profitability of economic activity characterizes the rate of compensation, or remuneration, for the entire set of sources used by the enterprise. Therefore, we will analyze the economic activities of OJSC Komsomolets by calculating the levels of profitability of production activities.

The profitability of production activities is calculated by the ratio of gross profit to the amount of costs for products sold.

The level of profitability of production activities is calculated as a whole for the enterprise and types of products and depends on three main factors: changes in the structure of products sold, their cost and average selling prices.

Using the method of chain substitutions, we will calculate the influence of these factors on changes in the level of profitability for the enterprise as a whole, and enter the obtained data into table 1.2.

Table 1.2

Results of factor analysis of overall profitability in

OJSC "Komsomolets" for 2002 - 2004, %.

The data obtained indicate that the plan for the level of profitability in 2002 and 2003 was exceeded, and in 2004, on the contrary, it was not fulfilled by 0.18%. The plan was exceeded in 2002 due to an increase in the average price level by 1.4%, in 2004 - 59.13%. The increase in the cost of goods sold caused an increase in the level of profitability in 2002 by 5.4%, in 2003 by 1.49%. And in 2004, an increase in the cost of goods sold caused a decrease in profitability by 59.32%.

2.2. Factor analysis of profitability for each type of product of OJSC Komsomolets Plant

Having analyzed the overall profitability of the production activities of OJSC Komsomolets, we will conduct a factor analysis of profitability for each type of product. The level of profitability of certain types of products depends on changes in average selling prices and unit costs.

The production of this enterprise is aimed mainly at the production of various types of transformers. Therefore, for this analysis we will take three main types, since they occupy the largest share in the output of commercial products.

Having determined the influence of these factors, we will enter the obtained data into Table 1.3.

Table 1.3

Profitability of certain types of products

OJSC "Komsomolets" for 2002 - 2004.

The data in Table 1.3 showed that the products manufactured by this enterprise are profitable. The highest level of profitability was in 2004. This suggests that the maximum possible amount of profit was received from the sale of these products, which was reflected in an increase in the level of profitability. The level of profitability in 2003 is higher than in 2002. This suggests that this enterprise allowed an increase in production costs in 2002, which certainly reduced the profitability of products.

As noted above, financial profitability characterizes the effectiveness of the investments of the owners of the enterprise, who provide resources to the enterprise or leave at its disposal all or part of their profits. Return on capital is calculated by the ratio of book profit to the average annual cost of all invested capital. Balance sheet profit depends on the volume of products sold, its structure, cost, average price level and financial results from other activities.

To calculate the influence of factors on the level of profitability, it is necessary to have the following initial data, which are shown in table 1.4.

Table 1.4.

Input data for factor analysis of profitability

invested capital of OJSC Komsomolets for 2002 - 2004

Indicators


Profit from sales
Non-realization financial results
Balance sheet profit amount
Average annual amount of fixed and working capital
Product sales volume assessed at planned cost
Capital turnover ratio
Estimated requirement for fixed and working capital

Using the data in Table 1.4, we will calculate the influence of factors on

the level of return on invested capital of OJSC Komsomolets, and the obtained data will be entered into table 1.5.

Table 1.5

Results of factor analysis of the return on investment

capital in OJSC Komsomolets for 2002 - 2004.

These calculations in Table 1.5 allow us to conclude that only thanks to the increased acceleration of capital turnover in 2002, the capital level plan was fulfilled. Non-realization financial results also had a positive impact by 0.5% and an increase in prices by 5.54%. Increased production costs led to a decrease in return on capital by 2.11%. The increase in return on capital in 2003 by 2.22% was positively influenced by all factors - the structure of sold products by 0.01%, the acceleration of capital turnover by 0.26%, and non-sales financial results by 0.87%. The level of return on capital in 2004 was 1.48%, including due to an increase in prices of commercial products by 0.16%, a decrease in the cost of commercial products by 2.62%, and an acceleration of capital turnover by 0.22%. A decrease in non-operating results by 1.52% had a negative impact on the return on capital.

Conclusion

The indicator of production profitability is especially important in modern market conditions, when enterprise management is required to constantly make a number of extraordinary decisions to ensure profitability, and, consequently, the financial stability of the enterprise.

The factors influencing the profitability of production are numerous and varied. Some of them depend on the activities of specific teams, others are related to the technology and organization of production, the efficiency of use of production resources, and the introduction of achievements of scientific and technological progress.

As practical calculations have shown, profitability indicators have more or less significant fluctuations from year to year, which is a consequence of changes in sales prices and production costs. The level of selling prices is influenced, first of all, by the quantity and quality of commercial products.

As a result of the analysis of the profitability of the Komsomolets Plant OJSC, we received data that indicates that the plan for the level of profitability in 2002 and 2003 was exceeded, and in 2004, on the contrary, it was not fulfilled by 0.18%. The plan was exceeded in 2002 due to an increase in the average price level by 1.4%, in 2004 - 59.13%. The increase in the cost of goods sold caused an increase in the level of profitability in 2002 by 5.4%, in 2003 by 1.49%. And in 2004, an increase in the cost of goods sold caused a decrease in profitability by 59.32%.

We also found out that the products of this enterprise are profitable. The highest level of profitability was in 2004. This suggests that the maximum possible amount of profit was received from the sale of these products, which was reflected in an increase in the level of profitability. The level of profitability in 2003 is higher than in 2002. This suggests that this enterprise allowed an increase in production costs in 2002, which, of course, reduced the profitability of products.

At the same time, thanks to the increased acceleration of capital turnover in 2002, the capital level plan was fulfilled. Non-realization financial results also had a positive impact by 0.5% and an increase in prices by 5.54%. Increased production costs led to a decrease in return on capital by 2.11%. The increase in return on capital in 2003 by 2.22% was positively influenced by all factors - this is the structure of sold products by 0.01%, acceleration of capital turnover by 0.26%, non-sales financial results by 0.87%. The level of return on capital in 2004 was 1.48%, including due to an increase in prices of commercial products by 0.16%, a decrease in the cost of commercial products by 2.62%, and an acceleration of capital turnover by 0.22%. A decrease in non-operating results by 1.52% had a negative impact on the return on capital.

List of used literature

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Analysis of enterprise profitability using the example of Angara LLC

Brief description of the enterprise Angara LLC

Angara LLC is a company operating in the markets of Russia, the CIS countries and far abroad. The main activity of the company is supplying enterprises with petrochemical products. Being a stable and reliable enterprise, they have won the trust of their partners - the largest enterprises in the petrochemical and fuel and energy complex, manufacturers of high-tech products for industrial and household use.

Today, the organization’s partners can always count on a constant wide range of products produced by enterprises in Russia and Bashkortostan, on stability and long-term supplies, on a flexible pricing policy, and on an individual approach.

The experience, professionalism of the company’s employees, clarity and high quality of work of all departments and services - all this contributes to mutually beneficial cooperation with Angara LLC.

Analysis of enterprise profitability indicators

Profitability indicators characterize the efficiency of the enterprise as a whole, the profitability of various levels of activities (production, commercial, investment, etc.). They reflect the final results of business more fully than profit, because their value shows the relationship between the effect and available and consumed resources. Profitability indicators are used as a tool in investment policy and pricing.

Since making a profit is a prerequisite for commercial activity, and the financial stability of an enterprise is largely determined by the amount of profit received, the analysis of financial results becomes very relevant.

We will calculate the profitability indicators of the enterprise Angara LLC for 2012, reflecting the efficiency of financial and economic activities, which are calculated according to the formulas specified in Chapter 1, based on the data of the Balance Sheet for 2012 (Appendix 1), the profit and loss statement for 2012 (Appendix 2).

Financial profitability ratios:

1. Profitability of turnover (sales).

Shows how much profit accrues per unit of products sold.

Calculation formula:

R pr = Pr/BP * 100% = 1604/20791*100% = 7.7% (11)

Pr - profit;

VR - sales revenue.

2. Product profitability.

Shows the degree of profitability of product production, that is, how much profit the enterprise receives for each ruble of costs.

Calculation formula:

P s = Pr / Av = 1604/19187 * 100% = 8% (12)

Pr - profit;

Ср - production costs.

3. Overall return on assets.

Calculation formula:

R A o = Pr/A avg *100% = 1604/14233.5 * 100% = 11.2% (13)

Pr - profit;

And av - assets (average).

4. Net return on assets.

Shows the efficiency of using all property (enterprise management in the field of production activities).

Calculation formula:

R A h = PE/A av = 365/14233.5*100% = 2.5% (14)

PE - net profit;

And av - assets (average).

5. Return on equity.

Shows the efficiency of using equity capital.

Calculation formula:

R sk = PE/SC*100%=365/2547.5*100% = 14.3% (15)

PE - net profit;

SK - equity capital.

6. Profit from sales.

Ppr=VR - Z=20791 - 19187 = 1604 (16)

VR - sales revenue;

Z - total costs.

7. Net profit per 1 ruble of turnover.

Net profit per 1 ruble of turnover shows how much profit falls on each ruble earned

Calculation formula:

Ch p = ChP/BP*100%=365/20791*100% = 1.7% (17)

PE - net profit;

VR - sales revenue.

Let us compare the obtained coefficient data for 2012 with the available data for 2011 and obtain the deviation in Table 1.

Table 1 - Assessment of profitability of Angara LLC 2012

Based on the calculated indicators indicated in Table 1, we will consider the effectiveness and economic feasibility of the enterprise’s activities.

The most important indicators of the financial performance of the enterprise are summarized in Form No. 2 “Profit and Loss Statement”.

To carry out the analysis, we will draw up a table using the enterprise reporting data from Form No. 2 (see Appendix 2).

Table 2 - Analysis of financial results of Angara LLC for 2011-2012

Indicator name	For 2011	For 2012	Deviation	Specific gravity	Deviation +/- ;%

Sales revenue (excluding VAT, excise taxes and similar liabilities)
Cost of goods sold
Profit (loss) from sales
Other operating expenses
Non-operating income
Non-operating expenses
Profit (loss) before tax
Income tax and other similar payments
Profit (loss) from ordinary activities

An analysis of the financial results of the enterprise for 2011 and 2012 showed that, despite an increase in revenue from product sales by 44%, its cost increased by 48%. The share of costs in the cost of goods sold increased from 89.8% to 92.3%. As a result, the share of profit in products sold decreased by 2.5% compared to 2011.

Balance sheet profit also decreased by 45.7% compared to the previous year. This was due to an increase in operating and non-operating expenses by 100% and 29.6%, respectively, as well as a reduction in non-operating income by 46.1%.

Due to the increase in the total costs of the enterprise and income tax, the amount of which increased from 30% in 2011 to 35% in 2012, the net profit remaining at the disposal of the enterprise decreased by 57.8% compared to the previous year and amounted to 365 thousand rubles compared to 866 thousand rubles in 2011.

The decrease in profitability (see Table 1) of the enterprise is caused by a decrease in balance sheet and net profit due to an increase in non-operating operating expenses and insufficient profit from sales of products, due to an increase in the share of costs in the cost of products sold.

From the calculations made, we see that the return on sales decreased to 7.7% in 2012, against 10% in the previous year, i.e. profit from each ruble of products sold decreased by 2.3 kopecks. The profitability of core activities decreased by 3% at the end of 2012 compared to 2011, i.e. the profit received from each ruble spent on the production and sale of products decreased by 3 kopecks and amounted to 8 kopecks. A decrease in the profitability of sales and core activities indicates that the management of the enterprise should revise the selling price of products upward or revise downward the costs associated with the production and sale of products included in the cost price.

The return on the enterprise's total capital for 2012 decreased by 13.54% compared to the previous year and amounted to 2.5%, i.e. profit from each ruble invested in property in 2011 decreased by 13.5 kopecks.

Return on equity also declined. Profit per ruble of equity capital invested in production decreased by 30.5 kopecks and amounted to 14.3 kopecks in 2012, against 44.8 kopecks in 2011.

Net profit per 1 ruble of turnover in 2011 was 6 kopecks, in 2012 1.7 kopecks.

Based on the foregoing, we can conclude that in 2012 the enterprise’s activities were less efficient compared to the previous year.

Return on equity indicators decreased especially significantly.

The management of the enterprise should take measures to prevent further deterioration of the financial condition and develop measures for more rational management of the enterprise's capital in order to increase the efficiency of financial and economic activities.