What does the after-tax profit of subsidiary mean?

After-tax profit of subsidiaries refers to the actual total profit of subsidiaries after tax deduction. As a subsidiary of the parent company, a subsidiary has a relatively independent business entity and is responsible for its specific business. Therefore, the after-tax profit of subsidiaries is regarded as an important indicator to measure their independent operating ability and operating quality.

The after-tax profit of subsidiaries reflects the profit level of enterprises and their subsidiaries. If the after-tax profits of subsidiaries are higher, the profitability of the whole enterprise will naturally be stronger. In the era of centralized management of enterprises, there are many factors that affect the after-tax profits of subsidiaries, such as market size, operation management and capital investment.

After-tax profits of subsidiaries are of great significance to shareholders, investors and creditors. Shareholders hope that the after-tax profit of the enterprise can meet the investment plan and increase their income. Creditors are concerned about whether after-tax profits can pay interest and principal. After-tax profit of subsidiaries is also one of the important reference indicators when providing potential investors with data to evaluate enterprise performance.