X2M Connect (ASX:X2M) Operating Income : A$-6.75 Mil (TTM As of Dec. 2023)

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What is X2M Connect Operating Income?

X2M Connect's Operating Income for the six months ended in Dec. 2023 was A$-3.00 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Dec. 2023 was A$-6.75 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. X2M Connect's Operating Income for the six months ended in Dec. 2023 was A$-3.00 Mil. X2M Connect's Revenue for the six months ended in Dec. 2023 was A$7.48 Mil. Therefore, X2M Connect's Operating Margin % for the quarter that ended in Dec. 2023 was -40.09%.

X2M Connect's 5-Year average Growth Rate for Operating Margin % was 0.00% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. X2M Connect's annualized ROC % for the quarter that ended in Dec. 2023 was -49.99%. X2M Connect's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2023 was -1,197.45%.

X2M Connect Operating Income Historical Data

The historical data trend for X2M Connect's Operating Income can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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X2M Connect Operating Income Chart

X2M Connect Annual Data

Trend

Jun22

Jun23

Operating Income

-10.59

-6.96

X2M Connect Semi-Annual Data
	Dec20	Dec21	Jun22	Dec22	Jun23	Dec23
Operating Income	Get a 7-Day Free Trial			-6.62	-3.97	-3.21	-3.75	-3.00

X2M Connect Operating Income Calculation

Operating Income, is the profit a company earned through operations. All expenses, including cash expenses such as cost of goods sold (COGS), research & development, wages, and non-cash expenses, such as depreciation, depletion and amortization, have been deducted from the sales.

Operating Income for the trailing twelve months (TTM) ended in Dec. 2023 adds up the semi-annually data reported by the company within the most recent 12 months, which was A$-6.75 Mil.

X2M Connect (ASX:X2M) Operating Income Explanation

1. Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition.

X2M Connect's annualized ROC % for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	-6 * ( 1 - 0% )	/	( (11.482	+	12.524)	/ 2 )
=	-6	/	12.003
=	-49.99 %

where

	Invested Capital		(Q: Jun. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	14.175	-	6.406	-	( 1.785	-	max(0, 13.062	-	9.349	+	1.785	))
=	11.482

	Invested Capital		(Q: Dec. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	14.431	-	5.538	-	( 2.917	-	max(0, 12.951	-	9.32	+	2.917	))
=	12.524

Note: The Operating Income data used here is two times the semi-annual (Dec. 2023) data.

2. Joel Greenblatt's definition of Return on Capital:

X2M Connect's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2023 is calculated as:

	ROC (Joel Greenblatt) %		(Q: Dec. 2023 )
=	EBIT	/	Average of (Net fixed Assets	+	Net Working Capital)
=	EBIT	/	Average of (Property, Plant and Equipment	+	Net Working Capital)
			Q: Jun. 2023		Q: Dec. 2023
=	EBIT	/	( ( (Property, Plant and Equipment + Net Working Capital)	+	(Property, Plant and Equipment + Net Working Capital) )	/	count )
=	-5.628	/	( ( (0.45 + max(-3.429, 0))	+	(0.49 + max(-3.748, 0)) )	/	2 )
=	-5.628	/	( ( 0.45	+	0.49 )	/	2 )
=	-5.628	/	0.47
=	-1,197.45 %

where Working Capital is:

	Working Capital		(Q: Jun. 2023 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(2.406	+	0.228	+	4.77)	-	(6.406	+	0	+	4.427)
=	-3.429

	Working Capital		(Q: Dec. 2023 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(5.078	+	0.281	+	1.044)	-	(5.538	+	0	+	4.613)
=	-3.748

When net working capital is negative, 0 is used.

Note: The EBIT data used here is two times the semi-annual (Dec. 2023) EBIT data.

3. Operating Income is also linked to Operating Margin %:

X2M Connect's Operating Margin % for the quarter that ended in Dec. 2023 is calculated as:

Operating Margin %	=	Operating Income (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	-3	/	7.484
	=	-40.09 %

4. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Operating Income growth rate using Operating Income per share data.

Be Aware

Compared with a company's EBITDA margin, Operating Margin can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin may decline. Often the Operating Margin declines well before the company's revenue or even profit decline. Therefore, Operating Margin is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia's Operating Margin had already been in decline since 2002, although its earnings per share were still rising. Investors who paid attention to Operating Margin would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.

X2M Connect Operating Income Related Terms

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X2M Connect (ASX:X2M) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Hardware » X2M Connect Ltd (ASX:X2M) » Definitions » Operating Income

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Traded in Other Exchanges

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Address

18-24 Ricketts Road, Suite 1.01b, Building B, Mount Waverley, VIC, AUS, 3149

Website

https://www.x2mconnect.com

X2M Connect Ltd is an Internet of Things (IoT) technology company that uses the internet to deliver productivity improvements, cost savings, and improved public safety to enterprise and government customers. Its focus is servicing the utility sector in the Asia-Pacific utility market through the provision of technology that connects devices over the internet, such as water meters and gas pressure sensors, and which enables data exchange and control of these devices. The company's geographical segment includes South Korea; China; Taiwan and other countries. It derives a majority of revenue from South Korea.

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