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Jewett-Cameron Trading Co Ltd  (NAS:JCTCF) Net Income: \$2.55 Mil (TTM As of May. 2017)

Net Income is the net profit that a company earns after deducting all costs and losses including cost of goods, SGA, DDA, interest expenses, non-recurring items and tax. Jewett-Cameron Trading Co Ltd's net income for the three months ended in May. 2017 was \$1.21 Mil. Its net income for the trailing twelve months (TTM) ended in May. 2017 was \$2.55 Mil.

Net Income is linked to the most popular Earnings per Share (Diluted) number. Jewett-Cameron Trading Co Ltd's Earnings per Share (Diluted) for the three months ended in May. 2017 was \$0.53.

Historical Data

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

Jewett-Cameron Trading Co Ltd Annual Data

 Aug07 Aug08 Aug09 Aug10 Aug11 Aug12 Aug13 Aug14 Aug15 Aug16 Net Income 3.06 3.13 1.86 1.77 2.13

Jewett-Cameron Trading Co Ltd Quarterly Data

 Aug12 Nov12 Feb13 May13 Aug13 Nov13 Feb14 May14 Aug14 Nov14 Feb15 May15 Aug15 Nov15 Feb16 May16 Aug16 Nov16 Feb17 May17 Net Income 0.91 0.55 0.49 0.31 1.21

Calculation

Net Income is the net profit that a company earns after deducting all costs and losses including cost of goods, SGA, DDA, interest expenses, non-recurring items and tax.

Net Income
= Revenue - Cost of Goods Sold - Selling, General, & Admin. Expense - Research & Development - Depreciation, Depletion and Amortization - Interest Expense - Non-Recurring Items (NRI) - Tax Expense + Others
= - Depreciation, Depletion and Amortization - Interest Expense - Non-Recurring Items (NRI) - Tax Expense + Others
= Operating Income - Interest Expense - Non-Recurring Items (NRI) - Tax Expense + Others
= Pre-Tax Income - Tax Expense + Others

Jewett-Cameron Trading Co Ltd's Net Income for the fiscal year that ended in Aug. 2016 is calculated as

 Net Income (A: Aug. 2016 ) = Pre-Tax Income + Tax Provision + Other Income (Expense) + Net Income (Discontinued Operations) = 3.52 + -1.392 + -0.11 + 0 = 2.02

Jewett-Cameron Trading Co Ltd's Net Income for the quarter that ended in May. 2017 is calculated as

 Net Income (Q: May. 2017 ) = Pre-Tax Income + Tax Provision + Other Income (Expense) + Net Income (Discontinued Operations) = 2.026 + -0.82 + 0.001 + 0 = 1.21

Net Income for the trailing twelve months (TTM) ended in May. 2017 was 0.552 (Aug. 2016 ) + 0.486 (Nov. 2016 ) + 0.309 (Feb. 20 ) + 1.206 (May. 2017 ) = \$2.55 Mil.

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

Explanation

Net income is the most widely cited number in reporting a company's profitability. It is linked to the most popular earnings-per-share (EPS) number through:

Jewett-Cameron Trading Co Ltd's Earnings per Share (Diluted) (EPS) for the quarter that ended in May. 2017 is calculated as

 Earnings per Share (Diluted) (Q: May. 2017 ) = (Net Income - Preferred Dividends) / Shares Outstanding (Diluted Average) = (1.206 - 0) / 2.286 = 0.53

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

Although Net Income and Earnings-per-Share (EPS) are the most widely used parameter in measuring a company's profitability and valuation, it is the least reliable. The reason is that reported earnings can be manipulated easily by adjusting any numbers such as Depreciation, Depletion and Amotorization and non-recurring items.

EPS is most useful for companies that have:

Consistent accounting methods
And few restructurings

The dividend paid to preferred stocks needs to be subtracted from the total net income in the calculation of EPS because common stock holders are not entitled to that part of the net income.

Be Aware

Warren Buffett looks for consistency and upward long term trend. Because of share repurchase it is possible for net earnings trend to differ from EPS trend. He preferred net income over EPS. The companies with durable competitive advantage companies report higher % net earnings to total revenues.

Important: If a company is showing net earnings history greater than 20% on total revenues, it is probably benefiting from a long term competitive advantage.

If net earnings is less than 10%, likely to be in a highly competitive business.

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