“Alternative Performance Measurements” about alternative performance indicators

The ESMA guidelines require us to explain any indicator we use in evaluating the company’s financial or non-financial results, if this indicator is not found in the IFRS or XBRL standards published by ESEF. In the case of our financial reports, we use the following indicators: 

Indicator  Definition / Calculation method  Why it is relevant 
Operational profit  It is about the profit of the basic activity, the activity of serving our clients. 

It takes into account all income and expenses associated with the current activity and ignore financial income and expenses, or those related to the holding activity (of the group, our existence as a listed company). 

It is obtained by eliminating from the results of each business line the elements of income and expenses (cash or non-cash) that have nothing to do with the current activity. 

The most significant adjustments (differences between gross profit and operating profit) are: 

  1. Elimination of the financial result (addition to the gross profit of the expenses and decrease of the financial type revenues). 
  1. Elimination of non-cash IFRS adjustments related to the Stock Option Plan. 
The operational activity (also called ‘current’ or ‘basic’) represents the company’s business. 

Thus, the performance and activity of the business versus the competition are measured, regardless of the taxation environment, the reporting accounting framework or the financing method of the company (mix between equity and borrowed capital, costs of maintaining the stock market share, etc.). 

In other words, this is the result that the company (or each business segment) would have if it operated as a company financed entirely from its own sources (from “equity” – shareholders’ capital). 


Gross margin” , or 


The calculation formula of this indicator is “Revenue minus COGS (cost of goods sold)”. 

Thus, from the invoices issued to the clients, the value of the expenses directly associated with those projects (obtaining those revenues) is deducted. In the case of software license resale projects, we buy a license for RON 90 and sell it to the client for RON 100. The difference is “Gross Margin”. 

If we bill a customer for the services of implementing a cloud project, the gross margin is the difference between the revenue billed to the customer and the cost for man-hours required for deployment, regardless of whether the engineer performing the deployment is employed or a subcontractor. 

This indicator is the “GDP” of the company, it is the “added value” that we produce for our partners. 

This indicator reflects not only the value we bring to customers, but, turning our gaze to the inside of the company, it reflects the amounts of money we have at our disposal to cover fixed expenses.