The South African Reserve Bank currently publishes information on current income and expenditure of all incorporated business enterprises in South Africa. In terms of the 1993 System of National Accounts and other macroeconomic statistical frameworks, a distinction should be drawn between financial and non-financial incorporated businesses on the grounds that the principal functions, objectives and behaviour of these two classes of entities differ materially. Financial business enterprises are principally engaged in financial intermediation or auxiliary financial services, while non-financial business enterprises are principally engaged in the production of goods and non-financial services.This note briefly describes a number of key developments related to the profitability of non-financial incorporated business enterprises. The first section defines different profitability ratios, as well as the concepts of financial leverage and financial risk. In the next section the changes over time in the profitability of non-financial incorporated business enterprises are examined. This is followed by a brief analysis of the impact of inflation, interest rates and tax rates on the financing decisions of firms and the relationship between profitability and the utilisation of production capacity. Some observations on the linkages between profitability and fixed investment are then made, followed by concluding remarks.