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Harte-Hanks Inc (NYSE:HHS)
Gross Profit
$415.7 Mil (TTM As of Mar. 2014)

Harte-Hanks Inc's gross profit for the three months ended in Mar. 2014 was $92.5 Mil. Harte-Hanks Inc's gross profit for the trailing twelve months (TTM) ended in Mar. 2014 was $415.7 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Harte-Hanks Inc's gross profit for the three months ended in Mar. 2014 was $92.5 Mil. Harte-Hanks Inc's revenue for the three months ended in Mar. 2014 was $132.7 Mil. Therefore, Harte-Hanks Inc's Gross Margin for the quarter that ended in Mar. 2014 was 69.66%.

Harte-Hanks Inc had a gross margin of 69.66% for the quarter that ended in Mar. 2014 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Harte-Hanks Inc was 71.12%. The lowest was 26.22%. And the median was 62.95%.


Definition

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

Harte-Hanks Inc's Gross Profit for the fiscal year that ended in Dec. 2013 is calculated as

Gross Profit (A: Dec. 2013 )=Revenue - Cost of Goods Sold
=559.609 - 161.6
=398.0

Harte-Hanks Inc's Gross Profit for the quarter that ended in Mar. 2014 is calculated as

Gross Profit (Q: Mar. 2014 )=Revenue - Cost of Goods Sold
=132.727 - 40.276
=92.5

Harte-Hanks Inc Gross Profit for the trailing twelve months (TTM) ended in Mar. 2014 was 118.159 (Jun. 2013 ) + 95.658 (Sep. 2013 ) + 109.45 (Dec. 2013 ) + 92.451 (Mar. 2014 ) = $415.7 Mil.

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

Harte-Hanks Inc's Gross Margin for the quarter that ended in Mar. 2014 is calculated as

Gross Margin (Q: Mar. 2014 )=Gross Profit (Q: Mar. 2014 ) / Revenue (Q: Mar. 2014 )
=(Revenue - Cost of Goods Sold) / Revenue
=92.5 / 132.727
=69.66 %

* 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

Harte-Hanks Inc had a gross margin of 69.66% for the quarter that ended in Mar. 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.

Harte-Hanks Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Gross_Profit 274.7309.4310.6760.1684.1547.9521.5510.9409.0398.0

Harte-Hanks Inc Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
Gross_Profit 124.9118.4120.998.5110.093.4118.295.7109.592.5
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