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China Petroleum & Chemical Corp (NYSE:SNP)
Gross Profit
$81,455 Mil (TTM As of Mar. 2014)

China Petroleum & Chemical Corp's gross profit for the three months ended in Mar. 2014 was $19,988 Mil. China Petroleum & Chemical Corp's gross profit for the trailing twelve months (TTM) ended in Mar. 2014 was $81,455 Mil.

Gross Margin is calculated as gross profit divided by its revenue. China Petroleum & Chemical Corp's gross profit for the three months ended in Mar. 2014 was $19,988 Mil. China Petroleum & Chemical Corp's revenue for the three months ended in Mar. 2014 was $102,982 Mil. Therefore, China Petroleum & Chemical Corp's Gross Margin for the quarter that ended in Mar. 2014 was 19.41%.

China Petroleum & Chemical Corp had a gross margin of 19.41% for the quarter that ended in Mar. 2014 => No sustainable competitive advantage

During the past 13 years, the highest Gross Margin of China Petroleum & Chemical Corp was 30.76%. The lowest was 13.43%. And the median was 22.22%.


Definition

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

China Petroleum & Chemical Corp'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
=476005.784168 - 391977.8549
=84,028

China Petroleum & Chemical Corp's Gross Profit for the quarter that ended in Mar. 2014 is calculated as

Gross Profit (Q: Mar. 2014 )=Revenue - Cost of Goods Sold
=102982.329317 - 82994.5381526
=19,988

China Petroleum & Chemical Corp Gross Profit for the trailing twelve months (TTM) ended in Mar. 2014 was 18014.183241 (Jun. 2013 ) + 21705.8823529 (Sep. 2013 ) + 21747.4797554 (Dec. 2013 ) + 19987.7911647 (Mar. 2014 ) = $81,455 Mil.

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

China Petroleum & Chemical Corp'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
=19,988 / 102982.329317
=19.41 %

* 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

China Petroleum & Chemical Corp had a gross margin of 19.41% for the quarter that ended in Mar. 2014 => No sustainable 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.

China Petroleum & Chemical Corp Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Gross_Profit 20,66220,54725,57030,80929,36451,84564,44873,56377,92484,028

China Petroleum & Chemical Corp Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
Gross_Profit 18,16217,78817,22119,55321,47820,40818,01421,70621,74719,988
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