Operating Profit

Short definition

Operating profit is profit from the core business: gross profit less operating expenses. Finance income/expense and tax sit below; it may not equal EBIT in every report.

Detailed explanation

Operating expenses include selling, G&A, R&D and, depending on policy, depreciation. Whether other income and expense — FX, provisions, gains on asset sales — sit inside operating profit is a presentation choice that changes margins and ICR.

Operating profit is the P&L line closest to earnings power before capital structure. It is still accrual: a bad-debt provision hits operating profit, collections hit cash flow.

Why it matters for the CFO

Budget variance and pricing discipline collect here. If leverage rises, net income should fall while operating profit holds; if it does not, operating and financing lines are mixed.

How it is calculated

Faaliyet kârı = Brüt kâr − Faaliyet giderleri ± Diğer esas faaliyet kalemleri

Gross profit minus opex. Other operating items are in or out depending on presentation.

Variables in the formula

• OP: Operating profit
• GP: Gross profit
• Opex: Operating expenses

How to read it

Operating profit up with EBITDA flat can be lower depreciation or a provision release. Opex-to-sales shows scale; in inflation a nominal rise can hide a real squeeze.

Numerical example

Gross profit 140 mn TL, operating expenses 60 mn TL → operating profit = 140 − 60 = 80 mn TL.

Definitions are educational. They are not investment, credit or tax advice.