operating income

(redirected from Operational Incomes)

Operating Income

A company's income from the goods and services it provides, less its operating expenses and depreciation. The operating income does not include losses from interest payments or income tax. For example, a widget manufacturer earns $1,000,000 in gross revenue from the sale of widgets. The widgets cost $200,000 to make and his administrative and payroll expenses total $250,000. He also must subtract $50,000 in depreciation on his widget manufacturing equipment. His operating income is stated as: $1,000,000 - $200,000 - $250,000 - $50,000 = $500,000. Operating income is closely related to earnings before interest and taxes (EBIT), but EBIT includes nonoperating income, which is usually (but not always) significantly less than operating income. See also: Net income.

operating income

The excess of revenues over expenses derived from normal business operations. Operating income, representing income from ordinary business activities, excludes expenses, such as interest and taxes. Unusual nonrecurring items, such as gains from selling a subsidiary or losses from closing a plant, are not included in the calculation of operating income. Also called earnings before interest and taxes, operating profit. Compare operating loss. See also operating revenue.

operating income

See net operating income.

References in periodicals archive ?
Alaris Antennas has significantly increased revenue and profits since its set up in 2005 with operational incomes prior interest and tax increasing with a collected yearly income price of over 25% in the past decade.
Table - 1 Operating results of Bank Mandiri, 1999 - 2000 (Rp billion) Description Dec'99 Dec'00 Growth (%) Interest income 6,458 26,569 311.4 - Income in coupon of government bonds 3,061 20,208 560.2 - Income in credit interest and others 3,396 6,361 87.3 Interest cost 10,253 21,116 105.3 Net interest income (3,159) 6,544 -- Other operational incomes 637 1,092 71.4 Total of other operational incomes (3.159) 6.544 -- Administrative and general costs 1.569 1.806 151 Corporate burden 515 1.036 101,2 Productive assets depreciation and write, off 17,301 1,820 -89.5 Total of other operational burdens 19,385 4,663 -75.9 Non operational income/burden (4,448) 169 -- Profit/loss before tax (26,992) 2,051 -- Net profit/loss (26,992) 2,051 -- Source: Bank Mandiri
Although the incomes from interest rates have dropped, the payment for interests and other costs have decreased drastically and resulted in a positive net operational incomes.
Table - 1 Interest income and net profit of Bank Mega, 1997 - 1999 (Rp billion) Description 1997 1998 1999 Interest income 92.1 896.8 507.9 Interest burden 50.4 619.3 334.8 Net interest income 41.7 277.5 173.1 Other operational incomes 1.1 2.4 6.6 Other operational burdens 26.3 64.9 86.0 Other net operational burdens 25.2 62.6 79.3 Operational profit (loss) 16.5 214.9 93.8 Net profit (Loss) 8.0 149.8 50.3 Net profit per share 66 1,238 137
Table - 1 Operational income of Bapindo, June 1997 - June 1998 (Rp billion) Description June 1997 June 1998 Growth (%) Operational income 558.1 879.9 57.7 - Interest income 546.6 861.0 57.5 - Commissions 11.5 18.9 64.3 Interest burden 545.0 1549.5 184.3 Net interest income 13.1 (669.5) - Other operational incomes 32.0 3690.2 11432.0 - Commissions 11.5 26.6 131.3 - Foreign exchange income 16.3 3655.5 22326.4 - Other incomes 4.1 8.0 95.1 Other operational burdens 108.9 1486.9 1265.4 Operational profit (63.8) 1533.7 - Non operational income 120.5 52.5 -56.4 Business profit 56.7 1586.2 2697.5 Net profit 43.7 1110.4 2441.0 Retained profit start of period (1,155.8) (1,056.4) -8.6 Retained profit end of period (1,112.1) 53.90 -
The increase in the net profit was attributable to a surge in operational income especially income in foreign exchange that was valued at Rp867 billion.
The profit of Bapindo in the first half of 1998 came from operational incomes mainly income from foreign exchange trade.
In addition, it recorded a surplus in its other operational incomes and the surplus tended to grow that its net profit in 1997 surged by 40% from the year before.
Meanwhile, its other operational incomes amounted only to Rp 1.4 billion as against its other operational burdens of Rp 9.6 billion.

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