Kurumsal Finans ve Strateji Rehberi | Finance & Strategy Insights

Three of the most important indicators used to measure a company’s operational and financial risk are the Operating Leverage Ratio (OLR), the Financial Leverage Ratio (FLR), and the Combined Leverage Ratio (CLR).
In this article, we will walk through a practical case study to calculate these ratios step by step. This provides a clear guide for investors, finance professionals, and students who want to better understand the financial structure of a business.

Step 1: Data

• Unit sales price: 55 TL
• Sales volume: 90,000 units
• Unit variable cost: 25% of sales price = 13.75 TL
• Unit fixed cost: 40% of variable cost = 5.5 TL
• Long-term debt: 1,500,000 TL
• Interest rate: 40%
• Tax rate: 20%

Step 2: Income Statement Calculations

• Sales = 55 × 90,000 = 4,950,000 TL
• Total variable cost = 13.75 × 90,000 = 1,237,500 TL
• Contribution margin = 4,950,000 – 1,237,500 = 3,712,500 TL
• Total fixed cost = 5.5 × 90,000 = 495,000 TL
• EBIT (Earnings Before Interest & Taxes) = 3,712,500 – 495,000 = 3,217,500 TL
• Interest expense = 1,500,000 × 0.40 = 600,000 TL
• Profit before tax = 3,217,500 – 600,000 = 2,617,500 TL
• Tax expense = 2,617,500 × 0.20 = 523,500 TL
• Net profit = 2,617,500 – 523,500 = 2,094,000 TL

Step 3: Leverage Ratios

Operating Leverage Ratio (OLR):
Formula: OLR = Contribution Margin / EBIT
= 3,712,500 / 3,217,500 ≈ 1.15

Interpretation: A 1% change in sales leads to a 1.15% change in EBIT.

Financial Leverage Ratio (FLR):
Formula: FLR = EBIT / Profit Before Tax
= 3,217,500 / 2,617,500 ≈ 1.23

Interpretation: A 1% change in EBIT results in a 1.23% change in profit before tax.

Combined Leverage Ratio (CLR):
Formula: CLR = OLR × FLR
= 1.15 × 1.23 ≈ 1.42

Interpretation: A 1% change in sales leads to approximately a 1.42% change in net profit.

Conclusion

This example clearly demonstrates how leverage creates a risk–return trade-off for businesses:

• OLR → Reflects operational risk.
• FLR → Captures the financial debt risk.
• CLR → Shows the total combined effect.

For investors, these ratios are valuable for risk assessment.
For managers, they are crucial for strategic decision-making.