What Is an Income Statement and What Is It Used For? Real Example

Fundai Education Team · October 1, 2026 · 7 min read

Using the Shabriz example, learn what an income statement shows, how it is calculated, and where to read the report on Codal and Fundai.

The income statement is a company's financial report card for a specific period, showing how revenues are converted into net profit or loss after expenses are deducted. For investors who ask what an income statement is and what it is used for, this report is the starting point for measuring profitability, controlling costs and assessing a business's competitive strength.

What Is an Income Statement and What Does It Show?

In answer to the question of what an income statement shows, it can be said that this report shows a company's recognized revenues and expenses over a specific period. The balance sheet records a company's financial position at a specific point in time, whereas the income statement shows the company's financial trajectory and earning power over a three-, six-, nine- or twelve-month period.

To obtain the official figures of any listed company, its financial statements are published on the Codal system. A precise understanding of how these figures relate to cash flow, as covered in Reading Financial Statements in Fundamental Analysis: A Step-by-Step Guide to the Income Statement, Balance Sheet and Cash Flow, will help you assess cash performance alongside book profit.

By examining this financial statement, analysts extract profitability ratios such as the gross profit margin and the net profit margin to determine the share of profit in each rial of operating revenue. Also, basic earnings per share in the income statement is the net profit attributable to ordinary shareholders divided by the weighted average number of ordinary shares in the period, and it differs from twelve-month earnings per share (EPS TTM).

At Fundai, we record income statement data alongside historical variables to make comparing trends easy. For example, a detailed review of the financial structure of Tabriz Oil Refining is possible on the Tabriz Oil Refining page.

What does an income statement include?

To understand what an income statement includes, you need to know its step-by-step structure. It starts with operating revenue and, after accounting for cost of goods sold, other income and expenses, finance costs, non-operating items and tax, arrives at the final figure of net profit or loss.

Operating revenue is the income from the company's core activity, and its difference from the cost of goods sold makes up gross profit. After deducting administrative, general and selling expenses, adding other income and deducting other expenses, operating profit is obtained, which reflects the strength of the company's core business.

In the next step, finance costs arising from borrowing and loans are deducted, and other non-operating income and expenses have an effect, forming profit before tax. After deducting the tax for the period, the net profit for the financial period is derived. The table below shows the performance items of Tabriz Oil Refining Company based on the audited annual financial statements for the year ended 29 Esfand 1404 on Codal.

According to the audited financial statements of SHABRIZ on Codal, the company's net profit in fiscal year 1404 was 23,975.3 billion tomans.

How Is the Income Statement Calculated?

The question of how the income statement is calculated comes down to a few steps: first, cost of goods sold is subtracted from operating revenue to arrive at gross profit; then selling, general and administrative expenses and other expenses are deducted and other income is added to form operating profit; finally, after accounting for finance costs, non-operating items and tax, net profit is derived.

In the calculations below, we review the steps for recording annual profit based on the audited financial statements for 1404, and the calculation of trailing twelve-month (TTM) profit for Tabriz Oil Refining based on financial reports on Codal.

According to the income statement for the fiscal year ended 29 Esfand 1404 on Codal, the basic earnings per share of SHABRIZ was recorded at 8,002 rials. This metric divides net profit attributable to ordinary shareholders by the weighted average number of ordinary shares in the period, whereas on Fundai, trailing twelve-month EPS (EPS TTM) is derived by dividing the profit of the last four quarters by the company's number of shares, based on market data dated 1405/07/08 (30 billion shares).

What is a comprehensive income statement?

Knowing what a comprehensive income statement is clarifies the difference between the net profit for the period and other items of comprehensive income and loss. This financial statement includes the net profit or loss for the period together with "other comprehensive income and loss items"; these are items such as the revaluation surplus of fixed assets, which have not been realized and are recorded directly in the equity of the balance sheet.

Another important question is what a consolidated income statement is. If a company has subsidiaries and affiliates, the consolidated income statement shows the revenues and expenses of the entire group after eliminating intra-group transactions. According to the financial statements available on Codal, Tabriz Oil Refining Company has no consolidated report and publishes only a separate financial statement.

Transactions with owners, such as a capital increase from a cash contribution or the distribution of dividends, are not included in comprehensive income. To learn where these statements fit in stock analysis, you can read the article What Is Fundamental Analysis? A Complete Guide to Fundamental Stock Analysis on the Iranian Stock Exchange.

Where is the income statement on Codal?

Reviewing the Codal income statement is the first step in assessing the financial performance of any symbol. The closing share price is taken from the Tehran Securities Exchange Technology Management Co. website (TSETMC), and the price-to-trailing-twelve-month-earnings ratio (P/E TTM) is obtained by dividing the day's closing price by the trailing twelve-month earnings per share (EPS TTM).

1. Search for the notice on Codal Search for the symbol SHABRIZ on the Codal system and open the annual or interim financial statements you want to see the standard income statement.

2. Review the report on Fundai On the Tabriz Oil Refining income statement page, compare revenue items, cost of goods sold and quarterly net profit side by side.

3. Margin analysis and dollar view On the SHABRIZ profit margin page, examine the historical trend of the gross and net profit margins. For a more precise comparison, you can view the statements in thousand dollars at the NIMA or free-market rate; in this case, earnings per share (EPS) remains in rials.

At Fundai, we measure trailing twelve-month (TTM) net profit based on the sum of the last four quarters. For the symbol SHABRIZ, net profit for the twelve months ending 31 Khordad 1405 is 28,981.8 billion tomans, obtained from the sum of the profit of the last three quarters of 1404 and the spring quarter of 1405.

By going to the Filters section on Fundai, investors can screen the market's companies based on profit margin or growth in the sales amount reported in the monthly activity report. Past data is a tool for understanding a company's performance, but past performance is no guarantee of future profitability.

#Stock Market Education #Fundamental Analysis #Financial Statements