PAA Natural Gas Storage, L.P. (FRA:4PN) Cost of Goods Sold : €209.0 Mil (TTM As of Sep. 2013)

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What is PAA Natural Gas Storage, L.P. Cost of Goods Sold?

PAA Natural Gas Storage, L.P.'s cost of goods sold for the three months ended in Sep. 2013 was €19.5 Mil. Its cost of goods sold for the trailing twelve months (TTM) ended in Sep. 2013 was €209.0 Mil.

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin. PAA Natural Gas Storage, L.P.'s Gross Margin % for the three months ended in Sep. 2013 was 53.04%.

Cost of Goods Sold is also directly linked to Inventory Turnover. PAA Natural Gas Storage, L.P.'s Inventory Turnover for the three months ended in Sep. 2013 was 0.51.

PAA Natural Gas Storage, L.P. Cost of Goods Sold Historical Data

The historical data trend for PAA Natural Gas Storage, L.P.'s Cost of Goods Sold 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.

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PAA Natural Gas Storage, L.P. Cost of Goods Sold Chart

PAA Natural Gas Storage, L.P. Annual Data

Trend

Dec08

Dec09

Dec10

Dec11

Dec12

Cost of Goods Sold

11.33

18.02

25.01

168.44

190.48

PAA Natural Gas Storage, L.P. Quarterly Data
	Dec09	Mar10	Jun10	Sep10	Dec10	Mar11	Jun11	Sep11	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13	Sep13
Cost of Goods Sold	Get a 7-Day Free Trial											24.96	55.92	71.95	61.67	19.48

PAA Natural Gas Storage, L.P. Cost of Goods Sold Calculation

Cost of Goods Sold is the aggregate cost of goods produced and sold, and services rendered during the reporting period. It excludes Total Operating Expense, such as Depreciation, Depletion and Amortization and Selling, General, & Admin. Expense.

Cost of Goods Sold for the trailing twelve months (TTM) ended in Sep. 2013 adds up the quarterly data reported by the company within the most recent 12 months, which was €209.0 Mil.

PAA Natural Gas Storage, L.P. (FRA:4PN) Cost of Goods Sold Explanation

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin.

PAA Natural Gas Storage, L.P.'s Gross Margin % for the three months ended in Sep. 2013 is calculated as:

Gross Margin %	=	(Revenue	-	Cost of Goods Sold)	/	Revenue
	=	(41.489	-	19.483)	/	41.489
	=	53.04 %

A company that has a moat can usually maintain or even expand their Gross Margin. A company can increase its Gross Margin in two ways. It can increase the prices of the goods it sells and keeps its Cost of Goods Sold unchanged. Or it can keep the sales price unchanged and squeeze its suppliers to reduce the Cost of Goods Sold. Warren Buffett believes businesses with the power to raise prices have moats.

Cost of Goods Sold is also directly linked to another concept called Inventory Turnover:

PAA Natural Gas Storage, L.P.'s Inventory Turnover for the three months ended in Sep. 2013 is calculated as:

Inventory Turnover	=	Cost of Goods Sold	/	Average Total Inventories
	=	19.483	/	38.527
	=	0.51

Inventory Turnover measures how fast the company turns over its inventory within a year. A higher inventory turnover means the company has light inventory. Therefore the company spends less money on storage, write downs, and obsolete inventory. If the inventory is too light, it may affect sales because the company may not have enough to meet demand.

Usually retailers pile up their inventories at holiday seasons to meet the stronger demand. Therefore, the inventory of a particular quarter of a year should not be used to calculate inventory turnover. An average inventory is a better indication.

PAA Natural Gas Storage, L.P. Cost of Goods Sold Related Terms

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PAA Natural Gas Storage, L.P. (FRA:4PN) Business Description

Industry

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Traded in Other Exchanges

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Address

Website

http://www.pnglp.com

PAA Natural Gas Storage, L.P., is a Delaware corporation formed by Plains All American Pipeline, L.P. on January 15, 2010. The Company is engaged in acquisition, development, operation and commercial management of natural gas storage facilities. The Company owns and operates three natural gas storage facilities located in Louisiana, Mississippi and Michigan. It also leases storage capacity and pipeline transportation capacity from third parties from time to time in order to increase its operational flexibility and enhance the services it offers to its customers. The Company provides natural gas storage services to a broad mix of customers, including local gas distribution companies, or LDCs, electric utilities, pipelines, direct industrial users, electric power generators, marketers, producers, LNG importers and affiliates of such entities. It generates revenue mainly from the provision of fee-based gas storage services to its customers. The majority of its net revenue from firm storage services is derived from contracts with initial terms that generally range from one year to 10 years in length and pursuant to which customers receive the assured or "firm" right to store gas in its facilities. Under its firm storage contracts, its customers are obligated to pay it fixed monthly capacity reservation fees, which is owed to it regardless of the actual storage capacity utilized. The Company also generate net revenue from the provision of hub services at its facilities and through the merchant storage activities of its commercial marketing group, which captures short term market opportunities by utilizing a portion of its storage capacity and engaging in related commercial marketing activities. The Company's merchant storage activities generate revenue through the hedged purchase and sale of natural gas net of any storage related costs incurred. It utilizes physical storage at its facilities and derivatives to hedge expected margin from these activities. The Company competes with several regional high-deliverability storage facilities along the Gulf Coast as well as the storage services offered by interstate and intrastate pipelines. The Company is subject to regulatory oversight by numerous federal, state, and local regulatory agencies.

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