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The following table shows several profitability ratios of Lemonade Ltd and the industry average for each ratio. Industry average 2018 2019 2020 2020 Return on
The following table shows several profitability ratios of Lemonade Ltd and the industry average for each ratio.
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|
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| Industry average |
| 2018 | 2019 | 2020 | 2020 |
Return on capital employed (ROCE) | 12.6% | 11.7% | 10.8% | 12% |
Gross Profit Margin | 30% | 31% | 33% | 35% |
Operating Profit Margin | 9% | 9% | 9% | 8% |
Discuss what the above ratios reveal about the profitability of Lemonade Ltd. (10 marks)
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