Gross Margin % is calculated as gross profit divided by its revenue. Lonrho's Gross Profit for the
six
months ended in Dec. 2012 was £28.1 Mil. Lonrho's Revenue for the
six
months ended in Dec. 2012 was £83.6 Mil. Therefore, Lonrho's Gross Margin % for the quarter that ended in Dec. 2012 was 33.61%.
The historical rank and industry rank for Lonrho's Gross Margin % or its related term are showing as below:
LSE:LONR'
s Gross Margin % Range Over the Past 10 Years
Min: 18.84 Med: 44.38 Max: 172.81
Current: 33.61
During the past 13 years, the highestGross Margin % of Lonrho was 172.81%. The lowest was 18.84%. And the median was 44.38%.
LSE:LONR's Gross Margin % is not ranked
in the Conglomerates industry.
Industry Median: 25.035
vs LSE:LONR: 33.61
Lonrho had a gross margin of 33.61% for the quarter that ended in Dec. 2012 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for Lonrho was 6.80% per year.
Lonrho Gross Margin % Historical Data
The historical data trend for Lonrho'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.
For the Conglomerates subindustry, Lonrho'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.
Lonrho's Gross Margin % Distribution in the Conglomerates Industry
For the Conglomerates industry and Industrials sector, Lonrho's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Lonrho's Gross Margin % falls into.
* 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.
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.
Lonrho (LSE:LONR) 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
Lonrho had a gross margin of 33.61% for the quarter that ended in Dec. 2012 => Competition eroding margins
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.
Lonrho Gross Margin % Related Terms
Thank you for viewing the detailed overview of Lonrho's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Lonrho PLC is engaged in providing the infrastructure and services required for the growing oil, mineral and agricultural sectors in Africa. The Company has a diverse portfolio of investments across Sub-Saharan Africa in four core operating sectors: Agribusiness, Infrastructure, Hotels and Support Services. Agribusiness vertically integrates the production, sourcing, logistics, processing and distribution of agricultural products from Sub-Saharan Africa to the consumer. The division supplies to its retailers in Sub-Saharan Africa, Europe, the USA, Middle East, Scandinavia and the Far East. The division also distributes agricultural and heavy machinery. Infrastructure division develops and manages oil logistics terminals. Luba Freeport, the oil service terminal in the Gulf of Guinea, has attracted oil service companies to be long term tenants at the port to service offshore exploration and production rigs. The Company's Hotel division includes hotels centred on the commercial, conference and business related markets across the Continent. It owns or manages hotels in Lubumbashi and Kinshasa in the Democratic Republic of the Congo, Maputo in Mozambique, Gaborone in Botswana and Mutare in Zimbabwe. IT business is a full systems integrator and manager that designs, builds, develops and integrates IT solutions for large corporate clients, banks and governments and then undertakes management contracts to run and manage installations. The IT division is a distributor for Cisco, Microsoft, Dell and Hewlett Packard systems and equipment.
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