Orica (ASX:ORI) Gross Margin % : 49.16% (As of Sep. 2023)

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What is Orica Gross Margin %?

Gross Margin % is calculated as gross profit divided by its revenue. Orica's Gross Profit for the six months ended in Sep. 2023 was A$1,953 Mil. Orica's Revenue for the six months ended in Sep. 2023 was A$3,972 Mil. Therefore, Orica's Gross Margin % for the quarter that ended in Sep. 2023 was 49.16%.

Warning Sign:

Orica Ltd gross margin has been in long-term decline. The average rate of decline per year is -3.5%.

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

ASX:ORI' s Gross Margin % Range Over the Past 10 Years
Min: 45.21 Med: 53.14 Max: 55.76
Current: 46.97

During the past 13 years, the highest Gross Margin % of Orica was 55.76%. The lowest was 45.21%. And the median was 53.14%.

ASX:ORI's Gross Margin % is ranked better than
91.06% of 1510 companies
in the Chemicals industry
Industry Median: 22.315 vs ASX:ORI: 46.97

Orica had a gross margin of 49.16% for the quarter that ended in Sep. 2023 => Durable competitive advantage

The 5-Year average Growth Rate of Gross Margin for Orica was -3.50% per year.

Orica Gross Margin % Historical Data

The historical data trend for Orica'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.

Orica Gross Margin % Chart

Orica Annual Data

Trend

Sep14

Sep15

Sep16

Sep17

Sep18

Sep19

Sep20

Sep21

Sep22

Sep23

Gross Margin %

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53.31

54.06

52.96

45.21

46.97

Orica Semi-Annual Data
	Mar14	Sep14	Mar15	Sep15	Mar16	Sep16	Mar17	Sep17	Mar18	Sep18	Mar19	Sep19	Mar20	Sep20	Mar21	Sep21	Mar22	Sep22	Mar23	Sep23
Gross Margin %	Get a 7-Day Free Trial															53.63	47.09	43.81	44.80	49.16

Competitive Comparison of Orica's Gross Margin %

For the Specialty Chemicals subindustry, Orica'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.

Orica's Gross Margin % Distribution in the Chemicals Industry

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

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

Orica Gross Margin % Calculation

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

Orica's Gross Margin for the fiscal year that ended in Sep. 2023 is calculated as

Gross Margin % (A: Sep. 2023 )	=	Gross Profit (A: Sep. 2023 )	/	Revenue (A: Sep. 2023 )
	=	3744	/	7970.5
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(7970.5 - 4226.5)	/	7970.5
	=	46.97 %

Orica's Gross Margin for the quarter that ended in Sep. 2023 is calculated as

Gross Margin % (Q: Sep. 2023 )	=	Gross Profit (Q: Sep. 2023 )	/	Revenue (Q: Sep. 2023 )
	=	1952.8	/	3972.1
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(3972.1 - 2019.3)	/	3972.1
	=	49.16 %

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.

Orica (ASX:ORI) 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

Orica had a gross margin of 49.16% for the quarter that ended in Sep. 2023 => 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.

Orica Gross Margin % Related Terms

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Orica (ASX:ORI) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Chemicals » Orica Ltd (ASX:ORI) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

OCLDY:USA ICA:Germany

Address

1 Nicholson Street, Level 3, East Melbourne, Melbourne, VIC, AUS, 3002

Website

https://www.orica.com

Orica is a leading global manufacturer and supplier of chemicals and explosives, primarily to the mining industry. It has operations in 50 countries across six continents. Mining services is the lone growth engine now that the chemicals business has been sold. Orica has an approximate 28% share of the global commercial explosives market. It provided resins, steel bolts, and other products for underground mining and tunneling though this business is now sold. It also supplies chemicals such as sodium cyanide to the mining industry.