Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
Diageo PLC, profitability ratios
Based on: 20-F (reporting date: 2014-06-30), 20-F (reporting date: 2013-06-30), 20-F (reporting date: 2012-06-30), 20-F (reporting date: 2011-06-30), 20-F (reporting date: 2010-06-30), 20-F (reporting date: 2009-06-30).
| Profitability ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Diageo PLC gross profit margin ratio improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014. |
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Diageo PLC operating profit margin ratio improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014. |
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Diageo PLC net profit margin ratio improved from 2012 to 2013 and from 2013 to 2014. |
| Profitability ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders’ equity. | Diageo PLC ROE improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014. |
| ROA | A profitability ratio calculated as net income divided by total assets. | Diageo PLC ROA improved from 2012 to 2013 but then slightly deteriorated from 2013 to 2014. |
Gross Profit Margin
Diageo PLC, gross profit margin calculation, comparison to benchmarks
| Jun 30, 2014 | Jun 30, 2013 | Jun 30, 2012 | Jun 30, 2011 | Jun 30, 2010 | Jun 30, 2009 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions, translated from GBP £) | |||||||
| Gross profit | 10,520) | 11,540) | 10,576) | 9,208) | 8,744) | 8,776) | |
| Sales | 23,611) | 25,666) | 23,734) | 20,559) | 19,945) | 19,859) | |
| Profitability Ratio | |||||||
| Gross profit margin1 | 44.56% | 44.96% | 44.56% | 44.79% | 43.84% | 44.19% | |
| Benchmarks | |||||||
| Gross Profit Margin, Competitors2 | |||||||
| Altria Group Inc. | — | — | — | — | — | — | |
| Coca-Cola Co. | — | — | — | — | — | — | |
| Mondelēz International Inc. | — | — | — | — | — | — | |
| PepsiCo Inc. | — | — | — | — | — | — | |
Based on: 20-F (reporting date: 2014-06-30), 20-F (reporting date: 2013-06-30), 20-F (reporting date: 2012-06-30), 20-F (reporting date: 2011-06-30), 20-F (reporting date: 2010-06-30), 20-F (reporting date: 2009-06-30).
1 2014 Calculation
Gross profit margin = 100 × Gross profit ÷ Sales
= 100 × 10,520 ÷ 23,611 = 44.56%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Diageo PLC gross profit margin ratio improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014. |
Operating Profit Margin
Diageo PLC, operating profit margin calculation, comparison to benchmarks
| Jun 30, 2014 | Jun 30, 2013 | Jun 30, 2012 | Jun 30, 2011 | Jun 30, 2010 | Jun 30, 2009 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions, translated from GBP £) | |||||||
| Operating profit | 4,572) | 5,686) | 5,136) | 4,032) | 3,962) | 3,950) | |
| Sales | 23,611) | 25,666) | 23,734) | 20,559) | 19,945) | 19,859) | |
| Profitability Ratio | |||||||
| Operating profit margin1 | 19.36% | 22.15% | 21.64% | 19.61% | 19.86% | 19.89% | |
| Benchmarks | |||||||
| Operating Profit Margin, Competitors2 | |||||||
| Altria Group Inc. | — | — | — | — | — | — | |
| Coca-Cola Co. | — | — | — | — | — | — | |
| Mondelēz International Inc. | — | — | — | — | — | — | |
| PepsiCo Inc. | — | — | — | — | — | — | |
Based on: 20-F (reporting date: 2014-06-30), 20-F (reporting date: 2013-06-30), 20-F (reporting date: 2012-06-30), 20-F (reporting date: 2011-06-30), 20-F (reporting date: 2010-06-30), 20-F (reporting date: 2009-06-30).
1 2014 Calculation
Operating profit margin = 100 × Operating profit ÷ Sales
= 100 × 4,572 ÷ 23,611 = 19.36%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Diageo PLC operating profit margin ratio improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014. |
Net Profit Margin
Diageo PLC, net profit margin calculation, comparison to benchmarks
| Jun 30, 2014 | Jun 30, 2013 | Jun 30, 2012 | Jun 30, 2011 | Jun 30, 2010 | Jun 30, 2009 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions, translated from GBP £) | |||||||
| Profit for the year attributable to equity shareholders of the parent company | 3,797) | 4,118) | 3,158) | 2,952) | 2,507) | 2,621) | |
| Sales | 23,611) | 25,666) | 23,734) | 20,559) | 19,945) | 19,859) | |
| Profitability Ratio | |||||||
| Net profit margin1 | 16.08% | 16.05% | 13.31% | 14.36% | 12.57% | 13.20% | |
| Benchmarks | |||||||
| Net Profit Margin, Competitors2 | |||||||
| Altria Group Inc. | — | — | — | — | — | — | |
| Coca-Cola Co. | — | — | — | — | — | — | |
| Mondelēz International Inc. | — | — | — | — | — | — | |
| PepsiCo Inc. | — | — | — | — | — | — | |
Based on: 20-F (reporting date: 2014-06-30), 20-F (reporting date: 2013-06-30), 20-F (reporting date: 2012-06-30), 20-F (reporting date: 2011-06-30), 20-F (reporting date: 2010-06-30), 20-F (reporting date: 2009-06-30).
1 2014 Calculation
Net profit margin = 100 × Profit for the year attributable to equity shareholders of the parent company ÷ Sales
= 100 × 3,797 ÷ 23,611 = 16.08%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Diageo PLC net profit margin ratio improved from 2012 to 2013 and from 2013 to 2014. |
Return on Equity (ROE)
Diageo PLC, ROE calculation, comparison to benchmarks
| Jun 30, 2014 | Jun 30, 2013 | Jun 30, 2012 | Jun 30, 2011 | Jun 30, 2010 | Jun 30, 2009 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions, translated from GBP £) | |||||||
| Profit for the year attributable to equity shareholders of the parent company | 3,797) | 4,118) | 3,158) | 2,952) | 2,507) | 2,621) | |
| Equity attributable to equity shareholders of the parent company | 11,523) | 11,661) | 9,088) | 8,149) | 6,167) | 5,208) | |
| Profitability Ratio | |||||||
| ROE1 | 32.95% | 35.32% | 34.75% | 36.22% | 40.65% | 50.33% | |
| Benchmarks | |||||||
| ROE, Competitors2 | |||||||
| Altria Group Inc. | — | — | — | — | — | — | |
| Coca-Cola Co. | — | — | — | — | — | — | |
| Mondelēz International Inc. | — | — | — | — | — | — | |
| PepsiCo Inc. | — | — | — | — | — | — | |
Based on: 20-F (reporting date: 2014-06-30), 20-F (reporting date: 2013-06-30), 20-F (reporting date: 2012-06-30), 20-F (reporting date: 2011-06-30), 20-F (reporting date: 2010-06-30), 20-F (reporting date: 2009-06-30).
1 2014 Calculation
ROE = 100 × Profit for the year attributable to equity shareholders of the parent company ÷ Equity attributable to equity shareholders of the parent company
= 100 × 3,797 ÷ 11,523 = 32.95%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders’ equity. | Diageo PLC ROE improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014. |
Return on Assets (ROA)
Diageo PLC, ROA calculation, comparison to benchmarks
| Jun 30, 2014 | Jun 30, 2013 | Jun 30, 2012 | Jun 30, 2011 | Jun 30, 2010 | Jun 30, 2009 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions, translated from GBP £) | |||||||
| Profit for the year attributable to equity shareholders of the parent company | 3,797) | 4,118) | 3,158) | 2,952) | 2,507) | 2,621) | |
| Total assets | 38,784) | 41,559) | 36,347) | 30,729) | 29,943) | 29,258) | |
| Profitability Ratio | |||||||
| ROA1 | 9.79% | 9.91% | 8.69% | 9.61% | 8.37% | 8.96% | |
| Benchmarks | |||||||
| ROA, Competitors2 | |||||||
| Altria Group Inc. | — | — | — | — | — | — | |
| Coca-Cola Co. | — | — | — | — | — | — | |
| Mondelēz International Inc. | — | — | — | — | — | — | |
| PepsiCo Inc. | — | — | — | — | — | — | |
Based on: 20-F (reporting date: 2014-06-30), 20-F (reporting date: 2013-06-30), 20-F (reporting date: 2012-06-30), 20-F (reporting date: 2011-06-30), 20-F (reporting date: 2010-06-30), 20-F (reporting date: 2009-06-30).
1 2014 Calculation
ROA = 100 × Profit for the year attributable to equity shareholders of the parent company ÷ Total assets
= 100 × 3,797 ÷ 38,784 = 9.79%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| ROA | A profitability ratio calculated as net income divided by total assets. | Diageo PLC ROA improved from 2012 to 2013 but then slightly deteriorated from 2013 to 2014. |