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GuruFocus has detected 7 Warning Signs with Brookfield Infrastructure Partners LP $BIP.
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Brookfield Infrastructure Partners LP (NYSE:BIP)
Gross Profit
$1,113 Mil (TTM As of Mar. 2017)

Brookfield Infrastructure Partners LP's gross profit for the three months ended in Mar. 2017 was $313 Mil. Brookfield Infrastructure Partners LP's gross profit for the trailing twelve months (TTM) ended in Mar. 2017 was $1,113 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Brookfield Infrastructure Partners LP's gross profit for the three months ended in Mar. 2017 was $313 Mil. Brookfield Infrastructure Partners LP's revenue for the three months ended in Mar. 2017 was $656 Mil. Therefore, Brookfield Infrastructure Partners LP's Gross Margin for the quarter that ended in Mar. 2017 was 47.71%.

Brookfield Infrastructure Partners LP had a gross margin of 47.71% for the quarter that ended in Mar. 2017 => Durable competitive advantage

During the past 10 years, the highest Gross Margin of Brookfield Infrastructure Partners LP was 56.98%. The lowest was 25.52%. And the median was 49.74%.


Definition

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

Brookfield Infrastructure Partners LP's Gross Profit for the fiscal year that ended in Dec. 2016 is calculated as

Gross Profit (A: Dec. 2016 )=Revenue - Cost of Goods Sold
=2115 - 1063
=1,052

Brookfield Infrastructure Partners LP's Gross Profit for the quarter that ended in Mar. 2017 is calculated as

Gross Profit (Q: Mar. 2017 )=Revenue - Cost of Goods Sold
=656 - 343
=313

Brookfield Infrastructure Partners LP Gross Profit for the trailing twelve months (TTM) ended in Mar. 2017 was 264 (Jun. 2016 ) + 255 (Sep. 2016 ) + 281 (Dec. 2016 ) + 313 (Mar. 2017 ) = $1,113 Mil.

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

Brookfield Infrastructure Partners LP's Gross Margin for the quarter that ended in Mar. 2017 is calculated as

Gross Margin (Q: Mar. 2017 )=Gross Profit (Q: Mar. 2017 ) / Revenue (Q: Mar. 2017 )
=(Revenue - Cost of Goods Sold) / Revenue
=313 / 656
=47.71 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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

Brookfield Infrastructure Partners LP had a gross margin of 47.71% for the quarter that ended in Mar. 2017 => 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 local exchange's currency.

Brookfield Infrastructure Partners LP Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
Gross_Profit 018742215547581,0031,0781,0571,052

Brookfield Infrastructure Partners LP Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
Gross_Profit 262263269269256252264255281313
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