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Carrizo Oil & Gas Inc (NAS:CRZO)
Gross Profit
$598.0 Mil (TTM As of Dec. 2014)

Carrizo Oil & Gas Inc's gross profit for the three months ended in Dec. 2014 was $130.4 Mil. Carrizo Oil & Gas Inc's gross profit for the trailing twelve months (TTM) ended in Dec. 2014 was $598.0 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Carrizo Oil & Gas Inc's gross profit for the three months ended in Dec. 2014 was $130.4 Mil. Carrizo Oil & Gas Inc's revenue for the three months ended in Dec. 2014 was $163.3 Mil. Therefore, Carrizo Oil & Gas Inc's Gross Margin for the quarter that ended in Dec. 2014 was 79.84%.

Carrizo Oil & Gas Inc had a gross margin of 79.84% for the quarter that ended in Dec. 2014 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Carrizo Oil & Gas Inc was 86.65%. The lowest was 53.85%. And the median was 81.38%.


Definition

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

Carrizo Oil & Gas Inc's Gross Profit for the fiscal year that ended in Dec. 2014 is calculated as

Gross Profit (A: Dec. 2014 )=Revenue - Cost of Goods Sold
=710.187 - 112.151
=598.0

Carrizo Oil & Gas Inc's Gross Profit for the quarter that ended in Dec. 2014 is calculated as

Gross Profit (Q: Dec. 2014 )=Revenue - Cost of Goods Sold
=163.275 - 32.914
=130.4

Carrizo Oil & Gas Inc Gross Profit for the trailing twelve months (TTM) ended in Dec. 2014 was 137.088 (Mar. 2014 ) + 166.009 (Jun. 2014 ) + 164.578 (Sep. 2014 ) + 130.361 (Dec. 2014 ) = $598.0 Mil.

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

Carrizo Oil & Gas Inc's Gross Margin for the quarter that ended in Dec. 2014 is calculated as

Gross Margin (Q: Dec. 2014 )=Gross Profit (Q: Dec. 2014 ) / Revenue (Q: Dec. 2014 )
=(Revenue - Cost of Goods Sold) / Revenue
=130.4 / 163.275
=79.84 %

* 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

Carrizo Oil & Gas Inc had a gross margin of 79.84% for the quarter that ended in Dec. 2014 => Durable competitive advantage


Related Terms

Cost of Goods Sold, Gross Margin, Revenue


Historical Data

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

Carrizo Oil & Gas Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
Gross_Profit 67.766.5101.1172.282.4107.1164.5313.4444.8598.0

Carrizo Oil & Gas Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
Gross_Profit 83.393.195.3115.0123.7110.8137.1166.0164.6130.4
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