Pretax earnings or profits

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Pretax earnings or profits

Net income before federal income taxes are subtracted.

Pretax Earnings or Profits

A company's total revenue less its operating expenses, interest paid, and depreciation, but not taxes. For example, a widget manufacturer earns $1,000,000 in total revenue. 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 net income is stated as: $1,000,000 - $200,000 - $250,000 - $50,000 = $500,000. It is important to note, however, that this number does not include any taxes that the widget manufacturer must pay that year; this fact is what differentiates pretax earnings or profits from net income.
References in periodicals archive ?
The $18.0 million increase in Nitrogen Production pretax earnings reflects the following:
The $6.2 million increase in Nitrogen Production pretax earnings reflects:
After including the Carefusion gain, a 5.5% increase in interest expense to $46.3 million and other expense of $4.5 million compared to income of $13.2 million a year ago, pretax earnings from ongoing lines improved 7.8% to $810.6 million.
Land O'Lakes Dairy Foods business reported pretax earnings of USD 61.0 million for the year, compared to USD 16.3 million in pretax earnings for 2008.
No bonus was paid for the first half of the year, but the goalposts were moved for the second half - with Next having to achieve pre-tax profits of pounds 427m and pretax earnings per share of 215p or more.
Under Next's previous measure, the company's pretax earnings per share (EPS) had to increase by at least 5% for any bonus to be paid.
The company contributes about 12 percent of its pretax earnings to the profit-sharing plan.
In September, Stadium reported pretax earnings rose 13% to [pounds sterling]1.4 million.
Botham's new responsibilities include managing LOL Foundation's charitable giving, which is 2% of the company's annual pretax earnings. She also will lead the company's community relations efforts, oversee its food donations and coordinate its annual United Way campaigns and will continue to lead media and public relations.
For 2005, accounting for all stock options will mean expensing $12 million on pretax earnings of $250 million, or about 5%, Nagel estimates.
The deal is expected to close sometime after April and will generate about $27 million in pretax earnings.
GE Insurance spokesman Mike Kachel said GE Edison Life has been a profitable business, with pretax earnings of between $230 million and $255 million in each of the past three years.