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Portland General Electric Company (NYSE:POR)
Gross Profit
$828 Mil (TTM As of Dec. 2013)

Portland General Electric Company's gross profit for the three months ended in Dec. 2013 was $224 Mil. Portland General Electric Company's gross profit for the trailing twelve months (TTM) ended in Dec. 2013 was $828 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Portland General Electric Company's gross profit for the three months ended in Dec. 2013 was $224 Mil. Portland General Electric Company's revenue for the three months ended in Dec. 2013 was $499 Mil. Therefore, Portland General Electric Company's Gross Margin for the quarter that ended in Dec. 2013 was 44.89%.

Portland General Electric Company had a gross margin of 44.89% for the quarter that ended in Dec. 2013 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Portland General Electric Company was 94.71%. The lowest was 37.80%. And the median was 88.61%.


Definition

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

Portland General Electric Company'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
=1810 - 982
=828

Portland General Electric Company's Gross Profit for the quarter that ended in Dec. 2013 is calculated as

Gross Profit (Q: Dec. 2013 )=Revenue - Cost of Goods Sold
=499 - 275
=224

Portland General Electric Company Gross Profit for the trailing twelve months (TTM) ended in Dec. 2013 was 230 (Mar. 2013 ) + 183 (Jun. 2013 ) + 191 (Sep. 2013 ) + 224 (Dec. 2013 ) = $828 Mil.

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

Portland General Electric Company's Gross Margin for the quarter that ended in Dec. 2013 is calculated as

Gross Margin (Q: Dec. 2013 )=Gross Profit (Q: Dec. 2013 ) / Revenue (Q: Dec. 2013 )
=(Revenue - Cost of Goods Sold) / Revenue
=224 / 499
=44.89 %

* 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

Portland General Electric Company had a gross margin of 44.89% for the quarter that ended in Dec. 2013 => 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.

Portland General Electric Company Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Gross_Profit 1,327775757864698682780852868828

Portland General Electric Company Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Gross_Profit 207210231206219212230183191224
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