Reliance Worldwide (ASX:RWC) Gross Margin %

: 39.11% (As of Dec. 2023)

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Gross Margin % is calculated as gross profit divided by its revenue. Reliance Worldwide's Gross Profit for the six months ended in Dec. 2023 was A$345 Mil. Reliance Worldwide's Revenue for the six months ended in Dec. 2023 was A$881 Mil. Therefore, Reliance Worldwide's Gross Margin % for the quarter that ended in Dec. 2023 was 39.11%.

Warning Sign:

Reliance Worldwide Corp Ltd gross margin has been in long-term decline. The average rate of decline per year is -1.4%.

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

ASX:RWC' s Gross Margin % Range Over the Past 10 Years
Min: 38.45 Med: 41.2 Max: 44.03
Current: 39.18

During the past 7 years, the highest Gross Margin % of Reliance Worldwide was 44.03%. The lowest was 38.45%. And the median was 41.20%.

ASX:RWC's Gross Margin % is ranked better than
83.59% of 1609 companies
in the Construction industry
Industry Median: 19.08 vs ASX:RWC: 39.18

Reliance Worldwide had a gross margin of 39.11% for the quarter that ended in Dec. 2023 => Competition eroding margins

The 5-Year average Growth Rate of Gross Margin for Reliance Worldwide was -1.40% per year.

Reliance Worldwide Gross Margin % Historical Data

The historical data trend for Reliance Worldwide'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.

Reliance Worldwide Annual Data

Trend

Jun17

Jun18

Jun19

Jun20

Jun21

Jun22

Jun23

Gross Margin %

42.16

41.06

44.03

39.29

38.45

Reliance Worldwide Semi-Annual Data
	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
Gross Margin %											40.90	38.00	37.59	39.25	39.11

Competitive Comparison

For the Building Products & Equipment subindustry, Reliance Worldwide'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.

Reliance Worldwide Gross Margin % Distribution

For the Construction industry and Industrials sector, Reliance Worldwide's Gross Margin % distribution charts can be found below:

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

Reliance Worldwide Gross Margin % Calculation

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

Reliance Worldwide's Gross Margin for the fiscal year that ended in Jun. 2023 is calculated as

Gross Margin % (A: Jun. 2023 )	=	Gross Profit (A: Jun. 2023 )	/	Revenue (A: Jun. 2023 )
	=	712.5	/	1853.265
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(1853.265 - 1140.738)	/	1853.265
	=	38.45 %

Reliance Worldwide's Gross Margin for the quarter that ended in Dec. 2023 is calculated as

Gross Margin % (Q: Dec. 2023 )	=	Gross Profit (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	344.5	/	880.756
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(880.756 - 536.252)	/	880.756
	=	39.11 %

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.

Reliance Worldwide (ASX:RWC) 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

Reliance Worldwide had a gross margin of 39.11% for the quarter that ended in Dec. 2023 => 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.

Reliance Worldwide Gross Margin % Related Terms

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Reliance Worldwide (ASX:RWC) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Construction » Reliance Worldwide Corp Ltd (ASX:RWC) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

RLLWF:USA 0EU:Germany

Address

140 William Street, Level 26, Melbourne, VIC, AUS, 3000

Website

https://www.rwc.com

Reliance Worldwide designs, manufactures, and supplies branded plumbing products which are sold across North America, Asia-Pacific, and Europe. The company focuses on push-to-connect plumbing products, including fitting, pipes and valves, under its brands SharkBite, JG Speedfit, and EvoPex. Reliance's products are used in residential and commercial applications for the residential renovation, maintenance, and home improvement end-markets. Reliance sells around 45% of its products to plumbing wholesalers and merchants, 35% to hardware and home improvement retailers (including Home Depot, Lowe's, and Reece) and 20% to original equipment manufacturers of hot water systems.

Reliance Worldwide (ASX:RWC) Headlines

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