GURUFOCUS.COM » STOCK LIST » Basic Materials » Metals & Mining » African Minerals Ltd (FRA:OUV) » Definitions » Degree of Financial Leverage

African Minerals (FRA:OUV) Degree of Financial Leverage : 0.00 (As of Jun. 2014)


View and export this data going back to . Start your Free Trial

What is African Minerals Degree of Financial Leverage?

Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in Earnings Before Interest and Taxes (EBIT). African Minerals's Degree of Financial Leverage for the quarter that ended in Jun. 2014 was 0.00. The higher Degree of Financial Leverage, the more volatile earnings will be.

The industry rank for African Minerals's Degree of Financial Leverage or its related term are showing as below:

FRA:OUV's Degree of Financial Leverage is not ranked *
in the Metals & Mining industry.
Industry Median: 0.96
* Ranked among companies with meaningful Degree of Financial Leverage only.

African Minerals Degree of Financial Leverage Historical Data

The historical data trend for African Minerals's Degree of Financial Leverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

African Minerals Degree of Financial Leverage Chart

African Minerals Annual Data
Trend Dec04 Dec05 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13
Degree of Financial Leverage
Get a 7-Day Free Trial Premium Member Only Premium Member Only - - - - -

African Minerals Semi-Annual Data
Jun10 Dec10 Jun11 Dec11 Jun12 Dec12 Jun13 Dec13 Jun14
Degree of Financial Leverage Get a 7-Day Free Trial Premium Member Only - - - - -

Competitive Comparison of African Minerals's Degree of Financial Leverage

For the Other Industrial Metals & Mining subindustry, African Minerals's Degree of Financial Leverage, along with its competitors' market caps and Degree of Financial Leverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


African Minerals's Degree of Financial Leverage Distribution in the Metals & Mining Industry

For the Metals & Mining industry and Basic Materials sector, African Minerals's Degree of Financial Leverage distribution charts can be found below:

* The bar in red indicates where African Minerals's Degree of Financial Leverage falls into.



African Minerals Degree of Financial Leverage Calculation

African Minerals's Degree of Financial Leverage for the quarter that ended in Jun. 2014 is calculated as:

Degree of Financial Leverage=% Change in Earnings per Share (Diluted)**/% Change in EBIT
=( -0.113 (Jun. 2014) / 0.173 (Jun. 2013) - 1 )/( 56.272 (Jun. 2014) / 133.054 (Jun. 2013) - 1 )
=-1.6532/-0.5771
=2.86***

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

** TTM data of EPS and EBIT was used to calculate Degree of Financial Leverage.
*** Please be aware that the Degree of Financial Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.


African Minerals  (FRA:OUV) Degree of Financial Leverage Explanation

Degree of Financial Leverage (DFL) is a leverage ratio that measures the sensitivity of a company’s Earnings per Share (EPS) to fluctuations in its operating income, also referred to as Earnings Before Interest and Taxes (EBIT), resulting from adjustments in its capital structure. DFL is an essential tool for companies to assess the appropriate level of debt or financial leverage in their capital structure. When EBIT remains relatively stable, it results in stable earnings and earnings per share. In such cases, the company may consider taking on substantial debt. However, for companies operating in industries with significant fluctuations in EBIT, it is advisable to keep debt at a manageable level.

The higher Degree of Financial Leverage, the more volatile earnings will be. Because interest is a fixed expense, leverage can amplify earnings and EPS. This is beneficial when EBIT is growing, but it can become problematic in tough economic conditions when EBIT is under pressure.

Be Aware

The use of financial leverage varies across different industries and business sectors, and the application of Degree of Financial Leverage (DFL) should be adjusted accordingly.


African Minerals Degree of Financial Leverage Related Terms

Thank you for viewing the detailed overview of African Minerals's Degree of Financial Leverage provided by GuruFocus.com. Please click on the following links to see related term pages.


African Minerals Business Description

Traded in Other Exchanges
N/A
Address
Stratton House, 5 Stratton Street, London, GBR, W1J 8LA
African Minerals Ltd is a mineral exploration and development company. It is engaged in the development, design, construction, and operation of iron ore deposit at Tonkolili, Sierra Leone, and its related rail and port infrastructure. In addition, it is also involved in the marketing and sale of the iron ore produced from this project.

African Minerals Headlines

No Headlines