Underlying Profit Definition
measure a company
uses to provide a more meaningful analysis of its performance. It may be used for business
process planning instead of the operating profit
reported for accounting
purposes. While operating profit is a defined concept, underlying
profit is calculated by the company as it sees fit. Its goal is to represent management's estimate of the long-term earning power
of the company. When calculating underlying profit, temporary disturbances, unusual circumstances or one-time events are excluded from the profit.