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Cheung Kong Holdings Ltd (OTCPK:CHEUY)
Gross Profit
\$12,711 Mil (TTM As of Jun. 2016)

Cheung Kong Holdings Ltd's gross profit for the six months ended in Jun. 2016 was \$10,238 Mil. Cheung Kong Holdings Ltd's gross profit for the trailing twelve months (TTM) ended in Jun. 2016 was \$12,711 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Cheung Kong Holdings Ltd's gross profit for the six months ended in Jun. 2016 was \$10,238 Mil. Cheung Kong Holdings Ltd's revenue for the six months ended in Jun. 2016 was \$16,557 Mil. Therefore, Cheung Kong Holdings Ltd's Gross Margin for the quarter that ended in Jun. 2016 was 61.84%.

Cheung Kong Holdings Ltd had a gross margin of 61.84% for the quarter that ended in Jun. 2016 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Cheung Kong Holdings Ltd was 858.13%. The lowest was 38.73%. And the median was 56.89%.

Definition

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

Cheung Kong Holdings Ltd'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 = 21515.4760215 - 8804.75311907 = 12,711

Cheung Kong Holdings Ltd's Gross Profit for the quarter that ended in Jun. 2016 is calculated as

 Gross Profit (Q: Jun. 2016 ) = Revenue - Cost of Goods Sold = 16556.5575883 - 6318.47461994 = 10,238

For company reported semi-annually, GuruFocus uses latest annual data as the TTM data. Cheung Kong Holdings Ltd Gross Profit for the trailing twelve months (TTM) ended in Jun. 2016 was \$12,711 Mil.

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

Cheung Kong Holdings Ltd'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 = 10,238 / 16556.5575883 = 61.84 %

* 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

Cheung Kong Holdings Ltd had a gross margin of 61.84% 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.

Cheung Kong Holdings Ltd Annual Data

 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Gross_Profit 945 1,570 940 953 1,309 1,720 1,493 1,741 1,729 12,711

Cheung Kong Holdings Ltd Semi-Annual Data

 Dec11 Jun12 Dec12 Jun13 Dec13 Jun14 Dec14 Jun15 Dec15 Jun16 Gross_Profit -838 837 654 654 1,086 90 1,639 1,932 10,778 10,238
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