Billion £ Profit Measurement of UKPIA Members Operating Costs Tax and Duty
Profit Measurement of UKPIA Members
As a result of decreased demand and facility closures due to coronavirus restrictions in 2020, both operating costs and gross sales for UKPIA members decreased substantially, by 37.2% and 35.2%, respectively. Tax and duty payments also decreased during the period but at a slower rate of 18.4% year-on-year with members paying over £17.4 billion. With the market challenges faced in 2020, members were not able to make a profit, instead seeing net costs (gross sales + operating costs) exceed gross sales for sector losses of £1.8 billion. Please note that for 2019 one company has reported for a period of 18 months. For 2020, another company has reported for a period of 14 months. As such, the data may not be directly comparable across the years. The negative efficiency of capital investment in the UK’s downstream sector for 2020 is driven by the negative profit achieved that year. While most sectors suffered significant decreases in capital investment efficiency, by 27.2% in manufacturing and 7.7% in upstream oil, the measure increased by 1.4% in the service sector. The 5- and 10-year average return on capital employed (ROCE) values are for the periods prior to 2020 (5- and 10-years ending in 2019). Also, note that refineries are included in ONS “manufacturing” sector statistics.
Gross Sales
80
70
60
50
40
30
20
10
0
2016
2017
2018
2019
2020
Source: UKPIA
Efficiency of Capital Investment
ROCE % Efficiency of Capital Investment
UKPIA Manufacturing Services Upstream Oil
10 15 20
0 5
2020
5-Yr Avg
10-Yr Avg
-25 -20 -15 -10 -5
Source: UKPIA
7 | Statistical Review | 2022
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