Fiat Industrial SpA (MIL:FI) Operating Income : €1,909 Mil (TTM As of Jun. 2013)

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What is Fiat Industrial SpA Operating Income?

Fiat Industrial SpA's Operating Income for the three months ended in Jun. 2013 was €613 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Jun. 2013 was €1,909 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Fiat Industrial SpA's Operating Income for the three months ended in Jun. 2013 was €613 Mil. Fiat Industrial SpA's Revenue for the three months ended in Jun. 2013 was €6,825 Mil. Therefore, Fiat Industrial SpA's Operating Margin % for the quarter that ended in Jun. 2013 was 8.98%.

Fiat Industrial SpA'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. Fiat Industrial SpA's annualized ROC % for the quarter that ended in Jun. 2013 was 4.91%. Fiat Industrial SpA's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2013 was 11.52%.

Fiat Industrial SpA Operating Income Historical Data

The historical data trend for Fiat Industrial SpA'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.

* Premium members only.

Fiat Industrial SpA Operating Income Chart

Fiat Industrial SpA Annual Data

Trend

Dec04

Dec05

Dec06

Dec07

Dec08

Dec09

Dec10

Dec11

Dec12

Operating Income

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2,972.00

359.00

992.00

1,629.00

1,862.00

Fiat Industrial SpA Quarterly Data
	Dec09	Mar10	Jun10	Sep10	Dec10	Mar11	Jun11	Sep11	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13
Operating Income	Get a 7-Day Free Trial										500.00	566.00	361.00	369.00	613.00

Fiat Industrial SpA 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 Jun. 2013 adds up the quarterly data reported by the company within the most recent 12 months, which was €1,909 Mil.

Fiat Industrial SpA (MIL:FI) Operating Income Explanation

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

Fiat Industrial SpA's annualized ROC % for the quarter that ended in Jun. 2013 is calculated as:

	ROC % (Q: Jun. 2013 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2013 )	+	Invested Capital (Q: Jun. 2013 ))	/ count )
=	2452 * ( 1 - 38% )	/	( (30982	+	31001)	/ 2 )
=	1520.24	/	30991.5
=	4.91 %

where

	Invested Capital		(Q: Mar. 2013 )
=	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	))
=	39806	-	5189	-	( 3635	-	max(0, 8020	-	28350	+	3635	))
=	30982

	Invested Capital		(Q: Jun. 2013 )
=	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	))
=	40394	-	5524	-	( 3869	-	max(0, 8499	-	28922	+	3869	))
=	31001

Note: The Operating Income data used here is four times the quarterly (Jun. 2013) data.

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

Fiat Industrial SpA's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2013 is calculated as:

	ROC (Joel Greenblatt) %		(Q: Jun. 2013 )
=	EBIT	/	Average of (Net fixed Assets	+	Net Working Capital)
=	EBIT	/	Average of (Property, Plant and Equipment	+	Net Working Capital)
			Q: Mar. 2013		Q: Jun. 2013
=	EBIT	/	( ( (Property, Plant and Equipment + Net Working Capital)	+	(Property, Plant and Equipment + Net Working Capital) )	/	count )
=	2452	/	( ( (4641 + max(16695, 0))	+	(4663 + max(16554, 0)) )	/	2 )
=	2452	/	( ( 21336	+	21217 )	/	2 )
=	2452	/	21276.5
=	11.52 %

where Working Capital is:

	Working Capital		(Q: Mar. 2013 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(1492	+	5660	+	17563)	-	(5189	+	0	+	2831)
=	16695

	Working Capital		(Q: Jun. 2013 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(1504	+	5821	+	17728)	-	(5524	+	0	+	2975)
=	16554

When net working capital is negative, 0 is used.

Note: The EBIT data used here is four times the quarterly (Jun. 2013) EBIT data.

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

Fiat Industrial SpA's Operating Margin % for the quarter that ended in Jun. 2013 is calculated as:

Operating Margin %	=	Operating Income (Q: Jun. 2013 )	/	Revenue (Q: Jun. 2013 )
	=	613	/	6825
	=	8.98 %

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.

Fiat Industrial SpA Operating Income Related Terms

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Fiat Industrial SpA (MIL:FI) Business Description

Industry

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Traded in Other Exchanges

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Address

Website

http://www.fiatindustrial.com

Fiat Industrial SpA operates in the capital goods sector. Each of the Group's businesses is a major international player in its respective industry sector: Iveco, CNH-Case New Holland and FPT Industrial. These three sectors design, produce and sell trucks, commercial vehicles, buses, special vehicles (Iveco), tractors, and agricultural and construction equipment (CNH), in addition to engines and transmissions for those vehicles and engines for marine applications (FPT Industrial). Agricultural equipment is sold under the New Holland Agriculture and Case IH and, in the premium segment in Europe, Steyr brands. Construction equipment is sold under the New Holland Construction and Case Construction brands, as well as the Kobelco brand in North America. Iveco designs, manufactures and sells a wide range of light (2.8-6 tons GVW), medium (6-16 tons GVW) and heavy (above 16 tons GVW) commercial vehicles for on-road and off-road use. In addition to its main product offer, the Company also offers after-sales and financing services, in addition to services related to used-vehicles. FPT Industrial is specialized in the design, production and sale of propulsion and transmission systems for on- and off-road trucks and commercial vehicles, as well as engines for marine application and power generation.