The review of Net Profit Margin witnessed a mixed trend. The Net Profit Margin improved from 38.73% in 2019 to 42.62% in 2023.
The average EBIT Margin for the period under analysis was 34.02%, with 2022 and 2023 performing the worst and best, respectively.
In the current year, Berkshire was able to cover its interest liabilities 25.02 times in the current year compared to 2017 when it was 26.93 times.
The Asset turnover stood at 0.28 times in 2023 from 0.15 in 2019, which implies a low performance on PPE/Assets of the business in relation to revenue.
Profitability
The revenue of Berkshire has shown a mixed trend year on year. The revenue decreased by 4% between 2019 and 2020 and an increase of 12% was recorded between 2020 and 2021. There also occurred a decrease of 9% between 2022 and 2023 (the current period).
Berkshire’s performance in profitability looks good as the return on equity also recorded a good performance during the period of analysis.
Capital Structure
Berkshire is both equity and debt financed.
The debt-to-equity (D/E) ratio has been falling year on year. The gearing position of the company appears to be low as it stood at 88% in the current year.
