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Molson Coors Brewing Co (NYSE:TAP)
Gross Profit
\$1,400 Mil (TTM As of Jun. 2016)

Molson Coors Brewing Co's gross profit for the three months ended in Jun. 2016 was \$424 Mil. Molson Coors Brewing Co's gross profit for the trailing twelve months (TTM) ended in Jun. 2016 was \$1,400 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Molson Coors Brewing Co's gross profit for the three months ended in Jun. 2016 was \$424 Mil. Molson Coors Brewing Co's revenue for the three months ended in Jun. 2016 was \$986 Mil. Therefore, Molson Coors Brewing Co's Gross Margin for the quarter that ended in Jun. 2016 was 42.99%.

Molson Coors Brewing Co had a gross margin of 42.99% for the quarter that ended in Jun. 2016 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Molson Coors Brewing Co was 44.32%. The lowest was 39.36%. And the median was 40.32%.

Warning Sign:

Molson Coors Brewing Co gross margin has been in long term decline. The average rate of decline per year is -2.1%.

Definition

Gross Profit is the different between the sale prices and the cost of buying or producing the goods.

Molson Coors Brewing Co's Gross Profit for the fiscal year that ended in Dec. 2015 is calculated as

 Gross Profit (A: Dec. 2015 ) = Revenue - Cost of Goods Sold = 3567.5 - 2163.5 = 1,404

Molson Coors Brewing Co's Gross Profit for the quarter that ended in Jun. 2016 is calculated as

 Gross Profit (Q: Jun. 2016 ) = Revenue - Cost of Goods Sold = 986.2 - 562.2 = 424

Molson Coors Brewing Co Gross Profit for the trailing twelve months (TTM) ended in Jun. 2016 was 431.5 (Sep. 2015 ) + 301.5 (Dec. 2015 ) + 243.2 (Mar. 2016 ) + 424 (Jun. 2016 ) = \$1,400 Mil.

Gross Profit is the numerator in the calculation of Gross Margin:

Molson Coors Brewing Co's Gross Margin for the quarter that ended in Jun. 2016 is calculated as

 Gross Margin (Q: Jun. 2016 ) = Gross Profit (Q: Jun. 2016 ) / Revenue (Q: Jun. 2016 ) = (Revenue - Cost of Goods Sold) / Revenue = 424 / 986.2 = 42.99 %

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.

Explanation

Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.

Durable competitive advantage creates a high Gross Margin because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin

1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key

Molson Coors Brewing Co had a gross margin of 42.99% for the quarter that ended in Jun. 2016 => Durable competitive advantage

Related Terms

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Molson Coors Brewing Co Annual Data

 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Gross_Profit 2,364 2,488 1,934 1,306 1,442 1,467 1,564 1,661 1,653 1,404

Molson Coors Brewing Co Quarterly Data

 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Gross_Profit 293 505 501 354 245 426 432 302 243 424
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