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Francescas Holdings Corp (NAS:FRAN)
Gross Profit
$174.1 Mil (TTM As of Jul. 2014)

Francescas Holdings Corp's gross profit for the three months ended in Jul. 2014 was $45.3 Mil. Francescas Holdings Corp's gross profit for the trailing twelve months (TTM) ended in Jul. 2014 was $174.1 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Francescas Holdings Corp's gross profit for the three months ended in Jul. 2014 was $45.3 Mil. Francescas Holdings Corp's revenue for the three months ended in Jul. 2014 was $97.3 Mil. Therefore, Francescas Holdings Corp's Gross Margin for the quarter that ended in Jul. 2014 was 46.56%.

Francescas Holdings Corp had a gross margin of 46.56% for the quarter that ended in Jul. 2014 => Durable competitive advantage

During the past 5 years, the highest Gross Margin of Francescas Holdings Corp was 53.48%. The lowest was 51.73%. And the median was 52.31%.


Definition

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

Francescas Holdings Corp's Gross Profit for the fiscal year that ended in Jan. 2014 is calculated as

Gross Profit (A: Jan. 2014 )=Revenue - Cost of Goods Sold
=340.325 - 164.26
=176.1

Francescas Holdings Corp's Gross Profit for the quarter that ended in Jul. 2014 is calculated as

Gross Profit (Q: Jul. 2014 )=Revenue - Cost of Goods Sold
=97.319 - 52.004
=45.3

Francescas Holdings Corp Gross Profit for the trailing twelve months (TTM) ended in Jul. 2014 was 40.357 (Oct. 2013 ) + 46.58 (Jan. 2014 ) + 41.832 (Apr. 2014 ) + 45.315 (Jul. 2014 ) = $174.1 Mil.

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

Francescas Holdings Corp's Gross Margin for the quarter that ended in Jul. 2014 is calculated as

Gross Margin (Q: Jul. 2014 )=Gross Profit (Q: Jul. 2014 ) / Revenue (Q: Jul. 2014 )
=(Revenue - Cost of Goods Sold) / Revenue
=45.3 / 97.319
=46.56 %

* 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

Francescas Holdings Corp had a gross margin of 46.56% for the quarter that ended in Jul. 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.

Francescas Holdings Corp Annual Data

Jan10Jan11Jan12Jan13Jan14
Gross_Profit 0.00.00.00.00.042.170.2106.8158.5176.1

Francescas Holdings Corp Quarterly Data

Apr12Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14
Gross_Profit 32.541.837.946.341.447.840.446.641.845.3
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