Operating Profit Margin (in %) – The bigger the numerical ratio the better.
This is one of the Efficiency Ratios in which the more efficient a company uses its resources, the more profitable a company is.
Calculate this ratio using the below equation. Values in the equation can be acquired from the Income Statement.
Equation:
Operating Profit Margin = (Operating Income) ÷ (Sales)
Equation results indicate how much operating income is generated for every dollar invested in sales.