PDSnet Glossary

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Definition

The profit of a company adjusted to eliminate the effect of seasonality. Some company's are very seasonal and get most of their income in one period during the calendar year. A good example is retailers who have a disproportionate quantity of sales over the Christmas period. Normalising earnings involves looking at the historical pattern of earnings and the adjusting to make the figures more comparable. Once-off expenses and incomes are also left out of normalised earnings.

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