Question

Jubilant Food Works Ltd., the company that operates Domino’s restaurants in India, reported a net profit of ₹ 65.7 crore for the three months ending, 31st December, 2023, against ₹ 80 crore for the three months ending, 31st December, 2022.

You are required to give, for the three months ending, 31st December, 2023, as compared to the same period ending, 31st December, 2022:

1. The formula to calculate the percentage change in net profit of the company.
2. The percentage change in the net profit of Jubilant Food Works Ltd. of the three months ending 31st December, 2023 vis-a-vis the three months ending, 31st December, 2022, mentioning the increase/decrease.

Jubilant Food Works Ltd., the company that operates Domino's restaurants in India, reported a net profit of ₹65.7 crore for the three months ending, 31st December, 2023, against ₹80 crore for the three months ending, 31st December, 2022.

You are required to give, for the three months ending, 31st December, 2023, as compared to the same period ending, 31st December, 2022 :

1. The formula to calculate the percentage change in net profit of the company.
2. The percentage change in the net profit of the three months ending 31st December, 2023 vis-a-vis the three months ending, 31st December, 2022.

Answer 1

(a) $$\frac{\text{Absolute Change in Net Profit}}{\text{Base Year (Previous Year) Profit}} \times 100$$

(b) Calculation of percentage change in the net profit:

Net Profit of Base Period (31st Dec 2022) = ₹80 crore

Net Profit of Current Period (31st Dec 2023) = ₹65.7 crore

Absolute Change = ₹ 65.7 crore - ₹ 80 crore

= - ₹ 14.3 crore

\(\text{Percentage\ Change}=\frac{-14.3}{80}\times 100\)

\(\text{Percentage\ Change}=-0.17875\times 100 ={-17.88\%}\)

There is a decrease of 17.88% in the net profit of the company.