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PROJECT 09Intermediate

Profit and Loss Analysis

Business scenario

The CFO needs a management P&L pack for 2025 with margins and budget variance explained, ready for the board.

Problem statement

Build the P&L structure (Revenue → Gross Profit → EBITDA → EBIT → Net Profit) monthly for 2025 vs budget and 2024, and explain the main movements.

Learning objectives

  • Structure a P&L from line items
  • Compute margins and variances correctly
  • Explain drivers of profit change

Instructions

Line classes in pnl_monthly: revenue, cogs, opex, da, interest, tax. Gross profit = revenue − cogs. EBITDA = gross profit − opex. EBIT = EBITDA − D&A. Net profit = EBIT − interest − tax. Favourable variance convention must handle costs (lower cost = favourable).

Tasks

  1. Monthly and full-year P&L 2025, 2024 and budget 2025.
  2. Gross, EBITDA and net margin %.
  3. Budget variance by line with favourable/unfavourable flags.
  4. YoY profit bridge (revenue, gross margin %, opex, D&A, interest, tax).
  5. Board commentary: three key messages.

Deliverables

  • Excel P&L pack
  • Commentary

Evaluation rubric

CriterionWeightExcellentProficientDevelopingInsufficient
P&L structure25%All subtotals and margins correct.Correct and complete with minor gaps in rigour or presentation.Partly correct; important steps missing, unvalidated or unclear.Missing, incorrect, or not supported by the data.
Variance logic20%Cost/revenue sign conventions correct.Correct and complete with minor gaps in rigour or presentation.Partly correct; important steps missing, unvalidated or unclear.Missing, incorrect, or not supported by the data.
Profit bridge15%Bridge reconciles.Correct and complete with minor gaps in rigour or presentation.Partly correct; important steps missing, unvalidated or unclear.Missing, incorrect, or not supported by the data.
Interpretation & recommendations25%Clear, quantified conclusions tied to the business question, with limitations stated.Correct and complete with minor gaps in rigour or presentation.Partly correct; important steps missing, unvalidated or unclear.Missing, incorrect, or not supported by the data.
Presentation15%Concise, well-labelled outputs a manager can act on without explanation.Correct and complete with minor gaps in rigour or presentation.Partly correct; important steps missing, unvalidated or unclear.Missing, incorrect, or not supported by the data.