Annual Report 2010-2011 - Colombo Stock Exchange

Glossary of Financial Terms
Associate Company
A Company other than a subsidiary in which a holding
company has a participating interest and exercises significant
influence over its operating and financial policies.
Current Ratio
Current Assets divided by Current Liabilities. A measure of
short term liquidity.
Debt to Equity Ratio
Long term Interest Bearing Borrowings divided by Net Assets.
Deferred Taxation
Sum set aside for tax in the Financial Statements that will
become payable in a financial year other than the current
financial year.
Dividend Cover
Profit attributable to Ordinary shareholders divided by Gross
Dividend. Measures the number of times dividend is covered by
distributable profit.
Dividend per Share
Gross Dividend divided by the number of Ordinary Shares in
issue at the year end.
Dividend Yield
Gross Dividend per share as a percentage of the year end
market price per share. A measure of return on shareholders’
investment.
Earnings Per Share (EPS)
Profits attributable to Ordinary Shareholders divided by the
weighted average number of Ordinary Shares in issue.
Earnings Yield
Earnings per Share as a percentage of the year end market
price per share.
Effective Tax Rate
Income Tax expenses divided by profit before tax.
Gearing Ratio
Proportion of total interest bearing liabilities to total capital
employed.
Gross Dividend
Portion of profits inclusive of tax withheld, distributed to
shareholders during the year.
Interest Cover
Profit Before Tax (PBT) plus net finance cost divided by net
finance cost. Measure of entity’s debt service ability.
Investment Property
A property that is not occupied by the owner, usually purchased
specifically to generate profit through rental income and/or
capital gains.
Market Capitalization
Number of shares in issue multiplied by the market value of a
share at the reported date.
Minority Interest
An outside ownership interest in a subsidiary that is
consolidated with the parent for financial reporting purposes.
Net Assets per Share
Shareholders’ fund divided by weighted average number of
Ordinary Shares in issue. A basis of relative share valuation.
Price Earnings Ratio
Market Price of a share divided by Earnings per share as
reported at that date.
Price to Book Value
Market price of a share divided by Net Assets per share.
Public Shareholding
Shares of a Listed Entity held by any person other than those
directly or indirectly held by;
a) its parent, subsidiary or associate companies or any
subsidiaries or associates of its parent company; and,
b) its directors who are holding office as directors of the Entity,
their spouses and children under 18 years of age; and,
c) Chief Executive Officer, his/her spouse and children under
18 years of age; and,
d) any single shareholder who holds 10% or more of the
shares.
Related Parties
Parties who could control or significantly influence the financial
and operating policies of the business.
Return on Total Capital Employed
Profit before Tax plus net finance cost divided by average total
capital employed.
Return on Equity
Profit after Tax less Preference Share dividend if any, expressed
as a percentage of Average Ordinary Shareholders’ Fund.
Revenue Reserves
Reserves considered as being available for distributions.
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Annual Report 2010/2011 | Richard Pieris and Company PLC