Return on Total Assets

A measure of the company's ability to make profitable use of its assets (regardless of financing). Interest is therefore excluded from the profit figure and the mix of equity to debt used to finance the assets is not considered.

Profit on ordinary activities before ________interest (and tax)_______	=	99.6	=	16%
Total Assets		632.3

How was this profit earned? The ROCE ratio can be broken down to Profit Margin and Net Asset

Turnover ratios:

(4) Profit Margin

The rate at which profit is earned on sales - for every £1 sale how many pence profit is earned?

Profit on ordinary activities before _______interest (and tax)_______	=	99.6	=	14%
Turnover (Sales)		725.8