Finance Dictionary
Welcome to the LEMAN Finance Dictionary — your guide to the sometimes-mysterious world of finance lingo! Financial terms can often sound like they’re from another language, so we created this dictionary to make them easier to digest. Let’s dive in and make those financial terms a bit friendlier!
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
A
B
C
Capital Expenditure (CapEx)
CapEx covers investments in physical assets, like equipment or buildings, that create long-term value. It contrasts with OpEx, focusing on major expenditures recorded as assets rather than costs. Understanding CapEx vs. OpEx is key to analyzing a company’s spending and assets.
Cash Flow
Cash flow measures the actual movement of money in and out of the business. Unlike accounting income, cash flow focuses on when funds are physically received or paid, making it a critical indicator of liquidity.
Current Ratio
The current ratio is the ratio of current assets to current liabilities and indicates the company’s ability to meet its short-term obligations.
D
Depreciations & Amortizations
Depreciations account for the loss of value of physical assets like buildings or machinery over time, while amortizations apply to intangible assets such as patents or licenses.
E
EBIT
(Earnings Before Interest and Taxes)
EBIT represents turnover after all costs, including depreciation, have been deducted, leaving only interest and taxes to be accounted for.
EBIT%
(Earnings Before Interest and Taxes Percentage)
The EBIT percentage expresses earnings before interest and taxes as a percentage of revenue. Unlike EBITDA, it includes amortizations and depreciations.
EBITDA%
(Earnings Before Interest, Taxes, Depreciation, and Amortization Percentage)
The EBITDA percentage represents earnings before interest, taxes, depreciation, and amortization as a percentage of revenue, providing a clear picture of operational profitability.
F
FTE (Full-Time Equivalent)
FTE represents the total number of full-time employees or equivalents, used to measure workforce capacity.
G
GP% (Gross Profit Percentage)
The gross profit percentage shows the relationship between gross profit and revenue. At LEMAN, gross profit is calculated as turnover minus consignment costs, before deducting both operating costs and fixed costs.
GP/Job (Gross Profit per Job)
Gross profit per job shows the average gross profit generated by each shipment, providing insight into individual job profitability.
Gross Profit (GP)
Gross profit is the result of turnover minus consignment costs, representing earnings from operations before deducting operating costs and fixed costs.
H
I
J
Job/FTE (Jobs per Full-Time Equivalent)
This metric shows the number of shipments handled per full-time employee and helps assess workforce utilization.
Jobs
In LEMAN’s context, jobs refer to shipments or tasks managed by the company, offering a view of business activity levels.
K
L
Local EBITDA
Local EBITDA reflects profit generated in a specific region after local overhead costs but before depreciation and amortization.
M
Manpower Ratio
At LEMAN, the manpower ratio measures the percentage of gross profit used for employee costs, including salaries and wages for both blue- and white-collar workers. The ratio reflects the efficiency of staffing in relation to profitability.
Manpower/Job
This metric can be used to calculate the average labor cost per job based on salaries and the number of jobs, though it is not actively measured at LEMAN today.
N
Net Contribution
Net contribution represents turnover after deducting consignment costs, operating costs, and fixed costs, leaving profit available for depreciation, amortization, and interest.
Net Profit Margin
Net profit margin measures net profit as a percentage of revenue, indicating overall profitability after all expenses, taxes, and interest.
O
Operating Expenditure (OpEx)
OpEx includes day-to-day operating costs like salaries, rent, and utilities. Unlike CapEx, these are ongoing expenses recorded directly as costs. Together, OpEx and CapEx provide a full picture of a company’s financial operations.
Operating Gross Profit (OGP)
Operating gross profit is what remains after deducting operating costs such as blue-collar wages, warehouse expenses, and temporary labor, but before subtracting fixed costs like IT and white-collar salaries.
P
Profit & Loss Statement (P&L)
The P&L statement summarizes LEMAN’s financial performance, providing an overview of turnover, costs, and profitability on a monthly basis.
Q
R
Return on Assets (ROA)
ROA measures how effectively a company uses its assets to generate profit, calculated as net income divided by total assets.
Return on Equity (ROE)
ROE measures how effectively a company generates profit from shareholders’ equity and is considered a key metric for financial performance.
Revenue Growth Rate
The revenue growth rate is the percentage increase in revenue over a specific period, reflecting a company’s ability to expand its income streams.
S
T
Turnover/Job (Revenue per Job)
This metric represents the average revenue generated per job or shipment, reflecting the financial value of each task.
U
V
W
Working Capital (WCR)
Working capital is calculated as accounts receivable plus inventory minus accounts payable. It measures a company’s short-term liquidity and financial health.
X
Y
Z
Find the most common finance terms in the logistics industry on this page.
Need our help?
What is your inquiry about?
Track your shipment with our Track & Trace
If you have inquiries that cannot be found in our Track & Trace please contact us via the form and we will get back to you as soon as possible.