COMMSEC
How to use company financials When it comes to a company’s financial health the volume of available data can be seemingly endless, but there are several relatively simple metrics and ratios to help you make sense of it. Australian companies typically report their financial results to the market twice a year, publishing huge documents full of numbers. One of the standout figures is net profit after tax, which shows what a company has earned minus all expenses, charges, depreciation and tax during a specified period. Further measures of earnings like EBIT, EBITDA and EPS also provide an extremely useful gauge of how a company is tracking, and then there’s insightful ratios such as price to earnings and dividend yield.