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Operating Profit Margin

Operating Profit Margin (often shortened to just Operating Margin) provides an indicator of the operating efficiency and / or pricing strategy of a business. It divides the operating income by revenue to identify the proportion of the revenue that remains after taking out the costs of operating the business (such as labour costs, material supplies, overheads, marketing, admin, etc.).


Operating Profit Margin = (Operating Profit  / Revenue) x 100

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