Chapter 4: Tracking Total Profit & Net Income

OPE Total Profit from Operations — 2012-16

Total profit

Profit from operations remained slim during the 4 years numbers were available, averaging less than 1.3%.

2012 2013 2014 2015 2016 4 Yr Avg
$32,336 $35,290 NA $45,543 $68,287 $45,364

OPE Total Net Income (Pre-Tax) — 2012-16

Total Net Income

During the 4 years studied, OPE dealers’ net income improved as new equipment sales increased.

2012 2013 2014 2015 2016 4 Yr Avg
$47,300 $46,254 NA $65,380 $83,329 $60,566

One of the anomalies in the numbers showed up in total profit from operations in 2014. While the other 4 years ranged from less than 1% in 2012 to nearly 1.6% in 2016, in 2014 calculations showed a total profit from operations at nearly 5.1%. Reducing overall expenses can help improve profits, and according to the 2014 report, total expenses fell by nearly 5.5% between 2013-14. And as reported earlier, 2014 was the lowest revenue year of the 5 covered in this report. Nonetheless, there isn’t enough other detail to determine why this anomaly showed up. (See "OPE Total Profit from Operations — 2012-16" and "OPE Total Net Income (Pre-Tax) — 2012-16".)

Excluding the high profit level of 2014, the average profit from operations for the period was 1.29%.

This anomaly also showed up in dealers’ net income figures for 2014. That year, OPE dealers reported an average net income of 5.43%. This compares to a low of 1.43%, which was reported in 2012 and a high of 1.96% for 2015, which was slightly higher than 2016 (1.92%) when revenues were 30% higher. Again, excluding the 2014 number, the average net income for the period was 1.73%.

Keep this fourth set of numbers handy — and share with your team — by downloading Measuring Up Chapter Four: Tracking Total Profit & Net Income

Continue to the next page for Chapter 5: Achieving Excellence in ROE & ROA

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