Name: Operating Profit Margin

Definition: Operating profit margin focuses on profits from the company’s core business — before interest payments and taxes. It reflects how well the business manages operating costs relative to sales. Strong operating margins show efficient day-to-day operations. Shrinking margins may reveal rising overhead, pricing weakness, or declining efficiency.

Interpretation:
• In '2021', PM's operating profit margin was 41.3%, highlighting profit earned from core business operations. Industry average for Medicinal Chemicals and Botanical Products in '2021' stood at -53.3%.
• In '2022', PM's operating profit margin was 38.6%, highlighting profit earned from core business operations. The decline from '2021' may indicate some operational or financial challenges. Industry average for Medicinal Chemicals and Botanical Products in '2022' stood at -90.4%. Industry average declined by 37.1% from previous year.
• In '2023', PM's operating profit margin was 34.7%, highlighting profit earned from core business operations. The decline from '2022' may indicate some operational or financial challenges. Industry average for Medicinal Chemicals and Botanical Products in '2023' stood at -66.3%. Industry average increased by 24.1% compared to previous year.
• In '2024', PM's operating profit margin was 35.4%, highlighting profit earned from core business operations. The increase since '2023' reflects strengthening financial performance. Industry average for Medicinal Chemicals and Botanical Products in '2024' stood at -41.7%. Industry average increased by 24.6% compared to previous year.
Overall, PM's operating profit margin has consistently declined during the past 4 years.

Formula: Operating Profit Margin = Operating Income / Revenue

Good Range: Often 10%-30% depending on business model.