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NGL Energy Partners LP (NYSE:NGL)
Gross Profit
\$772 Mil (TTM As of Sep. 2016)

NGL Energy Partners LP's gross profit for the three months ended in Sep. 2016 was \$117 Mil. NGL Energy Partners LP's gross profit for the trailing twelve months (TTM) ended in Sep. 2016 was \$772 Mil.

Gross Margin is calculated as gross profit divided by its revenue. NGL Energy Partners LP's gross profit for the three months ended in Sep. 2016 was \$117 Mil. NGL Energy Partners LP's revenue for the three months ended in Sep. 2016 was \$3,046 Mil. Therefore, NGL Energy Partners LP's Gross Margin for the quarter that ended in Sep. 2016 was 3.84%.

NGL Energy Partners LP had a gross margin of 3.84% for the quarter that ended in Sep. 2016 => No sustainable competitive advantage

During the past 8 years, the highest Gross Margin of NGL Energy Partners LP was 8.57%. The lowest was 3.89%. And the median was 7.10%.

Definition

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

NGL Energy Partners LP's Gross Profit for the fiscal year that ended in Mar. 2016 is calculated as

 Gross Profit (A: Mar. 2016 ) = Revenue - Cost of Goods Sold = 11742.11 - 10839.037 = 903

NGL Energy Partners LP's Gross Profit for the quarter that ended in Sep. 2016 is calculated as

 Gross Profit (Q: Sep. 2016 ) = Revenue - Cost of Goods Sold = 3045.538 - 2928.73 = 117

NGL Energy Partners LP Gross Profit for the trailing twelve months (TTM) ended in Sep. 2016 was 251.506 (Dec. 2015 ) + 248.28 (Mar. 2016 ) + 155.53 (Jun. 2016 ) + 116.808 (Sep. 2016 ) = \$772 Mil.

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

NGL Energy Partners LP's Gross Margin for the quarter that ended in Sep. 2016 is calculated as

 Gross Margin (Q: Sep. 2016 ) = Gross Profit (Q: Sep. 2016 ) / Revenue (Q: Sep. 2016 ) = (Revenue - Cost of Goods Sold) / Revenue = 117 / 3045.538 = 3.84 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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

NGL Energy Partners LP had a gross margin of 3.84% for the quarter that ended in Sep. 2016 => No sustainable competitive advantage

Related Terms

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

NGL Energy Partners LP Annual Data

 Mar09 Mar10 Mar11 Mar12 Mar13 Mar14 Mar15 Mar16 Gross_Profit 0 0 29 57 0 93 379 567 844 903

NGL Energy Partners LP Quarterly Data

 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Gross_Profit 115 201 240 288 216 187 252 248 156 117
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