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East Japan Railway Co  (OTCPK:EJPRY) Gross Profit: $9,794 Mil (TTM As of Dec. 2018)

East Japan Railway Co's gross profit for the three months ended in Dec. 2018 was $2,608 Mil. East Japan Railway Co's gross profit for the trailing twelve months (TTM) ended in Dec. 2018 was $9,794 Mil.

Gross Margin % is calculated as gross profit divided by its revenue. East Japan Railway Co's gross profit for the three months ended in Dec. 2018 was $2,608 Mil. East Japan Railway Co's Revenue for the three months ended in Dec. 2018 was $6,829 Mil. Therefore, East Japan Railway Co's Gross Margin % for the quarter that ended in Dec. 2018 was 38.20%.

East Japan Railway Co had a gross margin of 38.20% for the quarter that ended in Dec. 2018 => Competition eroding margins

During the past 13 years, the highest Gross Margin % of East Japan Railway Co was 36.08%. The lowest was 31.65%. And the median was 34.04%.


Historical Data

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

* Premium members only.

East Japan Railway Co Annual Data

Mar09 Mar10 Mar11 Mar12 Mar13 Mar14 Mar15 Mar16 Mar17 Mar18
Gross Profit Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 8,876.48 7,890.59 9,086.68 9,109.22 9,979.17

East Japan Railway Co Quarterly Data

Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18
Gross Profit Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 2,509.17 1,948.76 2,577.76 2,658.83 2,608.27

Competitive Comparison
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap.


East Japan Railway Co Distribution

* The bar in red indicates where East Japan Railway Co's Gross Profit falls into.



Calculation

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

East Japan Railway Co's Gross Profit for the fiscal year that ended in Mar. 2018 is calculated as

Gross Profit (A: Mar. 2018 )=Revenue - Cost of Goods Sold
=27819.3778596 - 17840.2082854
=9,979

East Japan Railway Co's Gross Profit for the quarter that ended in Dec. 2018 is calculated as

Gross Profit (Q: Dec. 2018 )=Revenue - Cost of Goods Sold
=6828.72635683 - 4220.45928944
=2,608

Gross Profit for the trailing twelve months (TTM) ended in Dec. 2018 was 1948.76224459 (Mar. 2018 ) + 2577.75944498 (Jun. 2018 ) + 2658.83062408 (Sep. 2018 ) + 2608.26706738 (Dec. 2018 ) = $9,794 Mil.

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

East Japan Railway Co's Gross Margin % for the quarter that ended in Dec. 2018 is calculated as

Gross Margin % (Q: Dec. 2018 )=Gross Profit (Q: Dec. 2018 ) / Revenue (Q: Dec. 2018 )
=(Revenue - Cost of Goods Sold) / Revenue
=2,608 / 6828.72635683
=38.20 %

* 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

East Japan Railway Co had a gross margin of 38.20% for the quarter that ended in Dec. 2018 => Competition eroding margins


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