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Teck Resources Ltd (NYSE:TCK)
Gross Profit
\$742 Mil (TTM As of Jun. 2016)

Teck Resources Ltd's gross profit for the three months ended in Jun. 2016 was \$164 Mil. Teck Resources Ltd's gross profit for the trailing twelve months (TTM) ended in Jun. 2016 was \$742 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Teck Resources Ltd's gross profit for the three months ended in Jun. 2016 was \$164 Mil. Teck Resources Ltd's revenue for the three months ended in Jun. 2016 was \$1,349 Mil. Therefore, Teck Resources Ltd's Gross Margin for the quarter that ended in Jun. 2016 was 12.18%.

Teck Resources Ltd had a gross margin of 12.18% for the quarter that ended in Jun. 2016 => No sustainable competitive advantage

During the past 13 years, the highest Gross Margin of Teck Resources Ltd was 58.49%. The lowest was 12.86%. And the median was 35.42%.

Warning Sign:

Teck Resources Ltd gross margin has been in long term decline. The average rate of decline per year is -19%.

Definition

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

Teck Resources Ltd's Gross Profit for the fiscal year that ended in Dec. 2015 is calculated as

 Gross Profit (A: Dec. 2015 ) = Revenue - Cost of Goods Sold = 6022.75213301 - 5090.06052651 = 933

Teck Resources Ltd's Gross Profit for the quarter that ended in Jun. 2016 is calculated as

 Gross Profit (Q: Jun. 2016 ) = Revenue - Cost of Goods Sold = 1349.46486738 - 1185.04730883 = 164

Teck Resources Ltd Gross Profit for the trailing twelve months (TTM) ended in Jun. 2016 was 255.540479421 (Sep. 2015 ) + 204.915044119 (Dec. 2015 ) + 117.193406926 (Mar. 2016 ) + 164.417558554 (Jun. 2016 ) = \$742 Mil.

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

Teck Resources Ltd's Gross Margin for the quarter that ended in Jun. 2016 is calculated as

 Gross Margin (Q: Jun. 2016 ) = Gross Profit (Q: Jun. 2016 ) / Revenue (Q: Jun. 2016 ) = (Revenue - Cost of Goods Sold) / Revenue = 164 / 1349.46486738 = 12.18 %

* 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

Teck Resources Ltd had a gross margin of 12.18% for the quarter that ended in Jun. 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 own currency.

Teck Resources Ltd Annual Data

 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Gross_Profit 3,317 3,065 1,899 2,594 3,494 4,763 3,560 2,280 1,331 933

Teck Resources Ltd Quarterly Data

 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Gross_Profit 366 275 376 361 276 252 256 205 117 164
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