The Profitability Report simulates a standard format income statement by combining regional product price with company, mill and country specific inputs. The quarterly Net Sales price is derived from Fastmarkets reported prices when available, while estimates are used in some regions and grades. The profitability report can be viewed at individual machine or aggregated to mill level with the option to add delivery cost. Prevailing corporate tax rate in the mill’s region is used.  

The Profitability Report follows the calculation: 

Net Sales = Regional product price 

Gross Profit = Net Sales – Cash Cost 

Operating Expense = Delivery cost (if included) + Selling expense + Overhead 

EBITDA = Gross Profit – Operating Expense 

Taxable Income = EBITDA – Capital cost (Capital Charge + Depreciation) 

Net Income = Taxable Income – Tax 

SG&A Cost = Operating Expense + Tax + Inventory Cost 

Total cost = Cash Cost + Capital cost (Capital Charge + Depreciation) + SG&A Cost 

The inclusion of delivery cost increases operating expenses and indirectly the SG&A costs. It is advisable to add the delivery cost estimate for a more realistic simulation.  

It is possible to eliminate the tax portion by using the scenario tool and setting the regional tax rate to zero.  

Note that the product price is fixed to the mill’s region even if delivery is selected to another world region. 

NB: Profitability Report is not available for tissue paper or for specialty & industrial paper.