Zep (FRA:14Z) Gross Margin % : 45.18% (As of Feb. 2015)

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What is Zep Gross Margin %?

Gross Margin % is calculated as gross profit divided by its revenue. Zep's Gross Profit for the three months ended in Feb. 2015 was €63.7 Mil. Zep's Revenue for the three months ended in Feb. 2015 was €141.0 Mil. Therefore, Zep's Gross Margin % for the quarter that ended in Feb. 2015 was 45.18%.

Warning Sign:

Zep Inc gross margin has been in long term decline. The average rate of decline per year is -2.2%.

The historical rank and industry rank for Zep's Gross Margin % or its related term are showing as below:

FRA:14Z' s Gross Margin % Range Over the Past 10 Years
Min: 46.03 Med: 49.81 Max: 57.58
Current: 46.22

During the past 11 years, the highest Gross Margin % of Zep was 57.58%. The lowest was 46.03%. And the median was 49.81%.

FRA:14Z's Gross Margin % is not ranked
in the Chemicals industry.
Industry Median: 22.38 vs FRA:14Z: 46.22

Zep had a gross margin of 45.18% for the quarter that ended in Feb. 2015 => Durable competitive advantage

The 5-Year average Growth Rate of Gross Margin for Zep was -2.20% per year.

Zep Gross Margin % Historical Data

The historical data trend for Zep's Gross Margin % 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.

Zep Gross Margin % Chart

Zep Annual Data

Trend

Aug05

Aug06

Aug07

Aug08

Aug09

Aug10

Aug11

Aug12

Aug13

Aug14

Gross Margin %

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49.81

46.89

46.03

47.06

46.92

Zep Quarterly Data
	May10	Aug10	Nov10	Feb11	May11	Aug11	Nov11	Feb12	May12	Aug12	Nov12	Feb13	May13	Aug13	Nov13	Feb14	May14	Aug14	Nov14	Feb15
Gross Margin %	Get a 7-Day Free Trial															46.94	46.45	46.36	46.81	45.18

Competitive Comparison of Zep's Gross Margin %

For the Specialty Chemicals subindustry, Zep's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:

* 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. Note that "N/A" values will not show up in the chart.

Zep's Gross Margin % Distribution in the Chemicals Industry

For the Chemicals industry and Basic Materials sector, Zep's Gross Margin % distribution charts can be found below:

* The bar in red indicates where Zep's Gross Margin % falls into.

Zep Gross Margin % Calculation

Gross Margin is the percentage of Gross Profit out of sales or Revenue.

Zep's Gross Margin for the fiscal year that ended in Aug. 2014 is calculated as

Gross Margin % (A: Aug. 2014 )	=	Gross Profit (A: Aug. 2014 )	/	Revenue (A: Aug. 2014 )
	=	245.4	/	523.063
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(523.063 - 277.642)	/	523.063
	=	46.92 %

Zep's Gross Margin for the quarter that ended in Feb. 2015 is calculated as

Gross Margin % (Q: Feb. 2015 )	=	Gross Profit (Q: Feb. 2015 )	/	Revenue (Q: Feb. 2015 )
	=	63.7	/	141.022
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(141.022 - 77.315)	/	141.022
	=	45.18 %

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.

Zep (FRA:14Z) Gross Margin % 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

Zep had a gross margin of 45.18% for the quarter that ended in Feb. 2015 => Durable competitive advantage

Be Aware

If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.

Zep Gross Margin % Related Terms

Thank you for viewing the detailed overview of Zep's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.

Zep (FRA:14Z) Business Description

Industry

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Traded in Other Exchanges

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Address

Website

http://www.zepinc.com

Zep Inc. was founded in 1937. It is a producer, marketer, and service provider of a range of cleaning and maintenance solutions for commercial, industrial, institutional, and consumer end-markets. Zeps product portfolio includes anti-bacterial and industrial hand care products, cleaners, degreasers, deodorizers, disinfectants, floor finishes, sanitizers, and pest and weed control products. It continually refreshes its product portfolio and service offerings. Zep reaches its customers through an experienced, international organization of sales representatives supported by highly skilled marketing, research and development and technical services teams, who collectively provide creative solutions for its customers' diverse cleaning and maintenance needs by utilizing their product expertise and providing customized value added services that it distinguish Zep among its competitors. Through its direct sales organization, Zep provides convenient, highly effective cleaning and maintenance solutions to customers in a broad array of commercial, industrial, and institutional end-markets, including transportation, food processing and service, manufacturing, government, and housekeeping. These customers include government entities and businesses ranging from small sole proprietorships to large corporations. It sells its products to customers mainly in the United States, Canada and Western Europe. Zep markes these products and services under well recognized and established brand names, such as Zep , Zep Commercial, Zep Professional, Enforcer, and Selig. Zep is its flagship brand and represents largest portfolio of cleaning and maintenance solutions for commercial, industrial, and institutional customers needing highly effective product solutions and professional technical support. Zep Commercial provides professional cleaning and plumbing chemical products targeted to contractors and small business owners and are currently sold through The Home Depot, HD Supply and other retailers. Zep Professional was introduced in fiscal year 2009 and represents its portfolio of cleaning and maintenance solutions that are offered to customers in the commercial, industrial, and institutional end-markets who prefer to acquire product through the distribution channel. Selig offers a limited assortment of cleaning solutions targeted to commercial, industrial and institutional customers. It produces a range of cleaning and maintenance solutions for commercial, industrial, institutional, and consumer customers. Zeps commercial, industrial, and institutional customers include government entities and businesses ranging from small sole proprietorships to large corporations as well as distributors. Its sales and service organization covers the United States, Canada, Italy, Belgium, Luxemburg, the Netherlands and certain other smaller markets. It manufactures products at six facilities located in the United States, Canada, the Netherlands, and Italy.The key raw materi

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