Lawson (TSE:2651) Operating Income : 円83,426 Mil (TTM As of Feb. 2024)

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What is Lawson Operating Income?

Lawson's Operating Income for the three months ended in Feb. 2024 was 円10,816 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Feb. 2024 was 円83,426 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Lawson's Operating Income for the three months ended in Feb. 2024 was 円10,816 Mil. Lawson's Revenue for the three months ended in Feb. 2024 was 円273,821 Mil. Therefore, Lawson's Operating Margin % for the quarter that ended in Feb. 2024 was 3.95%.

Warning Sign:

Lawson Inc operating margin has been in a 5-year decline. The average rate of decline per year is -6.8%.

Lawson's 5-Year average Growth Rate for Operating Margin % was -6.80% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. Lawson's annualized ROC % for the quarter that ended in Feb. 2024 was 1.26%. Lawson's annualized ROC (Joel Greenblatt) % for the quarter that ended in Feb. 2024 was 3.75%.

Lawson Operating Income Historical Data

The historical data trend for Lawson'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.

Lawson Operating Income Chart

Lawson Annual Data

Trend

Feb15

Feb16

Feb17

Feb18

Feb19

Feb20

Feb21

Feb22

Feb23

Feb24

Operating Income

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62,943.00

40,877.00

36,831.00

54,460.00

83,426.00

Lawson Quarterly Data
	May19	Aug19	Nov19	Feb20	May20	Aug20	Nov20	Feb21	May21	Aug21	Nov21	Feb22	May22	Aug22	Nov22	Feb23	May23	Aug23	Nov23	Feb24
Operating Income	Get a 7-Day Free Trial															1,706.00	25,674.00	25,258.00	21,678.00	10,816.00

Lawson 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 Feb. 2024 adds up the quarterly data reported by the company within the most recent 12 months, which was 円83,426 Mil.

Lawson (TSE:2651) Operating Income Explanation

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

Lawson's annualized ROC % for the quarter that ended in Feb. 2024 is calculated as:

	ROC % (Q: Feb. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Nov. 2023 )	+	Invested Capital (Q: Feb. 2024 ))	/ count )
=	43264 * ( 1 - 32.75% )	/	( (2294915	+	2320399)	/ 2 )
=	29095.04	/	2307657
=	1.26 %

where

	Invested Capital		(Q: Nov. 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	))
=	2265490	-	270033	-	( 389380	-	max(0, 981892	-	682434	+	389380	))
=	2294915

	Invested Capital		(Q: Feb. 2024 )
=	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	))
=	2297498	-	272423	-	( 433343	-	max(0, 1011192	-	715868	+	433343	))
=	2320399

Note: The Operating Income data used here is four times the quarterly (Feb. 2024) data.

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

Lawson's annualized ROC (Joel Greenblatt) % for the quarter that ended in Feb. 2024 is calculated as:

	ROC (Joel Greenblatt) %		(Q: Feb. 2024 )
=	EBIT	/	Average of (Net fixed Assets	+	Net Working Capital)
=	EBIT	/	Average of (Property, Plant and Equipment	+	Net Working Capital)
			Q: Nov. 2023		Q: Feb. 2024
=	EBIT	/	( ( (Property, Plant and Equipment + Net Working Capital)	+	(Property, Plant and Equipment + Net Working Capital) )	/	count )
=	47140	/	( ( (1261422 + max(-623182, 0))	+	(1251339 + max(-637817, 0)) )	/	2 )
=	47140	/	( ( 1261422	+	1251339 )	/	2 )
=	47140	/	1256380.5
=	3.75 %

where Working Capital is:

	Working Capital		(Q: Nov. 2023 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(239187	+	32494	+	21373)	-	(270033	+	0	+	646203)
=	-623182

	Working Capital		(Q: Feb. 2024 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(234295	+	29176	+	19054)	-	(272423	+	0	+	647919)
=	-637817

When net working capital is negative, 0 is used.

Note: The EBIT data used here is four times the quarterly (Feb. 2024) EBIT data.

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

Lawson's Operating Margin % for the quarter that ended in Feb. 2024 is calculated as:

Operating Margin %	=	Operating Income (Q: Feb. 2024 )	/	Revenue (Q: Feb. 2024 )
	=	10816	/	273821
	=	3.95 %

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.

Lawson Operating Income Related Terms

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Lawson (TSE:2651) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Retail - Defensive » Lawson Inc (TSE:2651) » Definitions » Operating Income

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LAW:Germany

Address

East Tower, Gate City Osaki, 11-2, Osaki 1-chome, Shinagawa-ku, Tokyo, JPN, 141-8643

Website

http://www.lawson.co.jp/company/ir/index.html

Lawson is the third-largest convenience-store operator in Japan with more than 14,500 stores domestically, and more than 3,400 stores overseas with more than 90% of stores located in China. Convenience-store operations inclusive of franchise fees represent about 55% of group operating revenue and 75% of operating profits. Other activities include Seijo Ishii (an upscale food-store chain with 163 stores in Japan as of November 2020) and entertainment businesses comprising cinema operations with 43 theaters, the HMV music store chain, and Lawson HMV ticketing services.

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