Gross Margin % is calculated as gross profit divided by its revenue. Furmanite's Gross Profit for the
three
months ended in Sep. 2015 was $25.6 Mil. Furmanite's Revenue for the
three
months ended in Sep. 2015 was $97.4 Mil. Therefore, Furmanite's Gross Margin % for the quarter that ended in Sep. 2015 was 26.32%.
The historical rank and industry rank for Furmanite's Gross Margin % or its related term are showing as below:
FRM's Gross Margin % is not ranked *
in the Construction industry.
Industry Median: 19.08 * Ranked among companies with meaningful Gross Margin % only.
Furmanite had a gross margin of 26.32% for the quarter that ended in Sep. 2015 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for Furmanite was 0.00% per year.
Furmanite Gross Margin % Historical Data
The historical data trend for Furmanite'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.
Competitive Comparison of Furmanite's Gross Margin %
For the Engineering & Construction subindustry, Furmanite'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.
Furmanite's Gross Margin % Distribution in the Construction Industry
For the Construction industry and Industrials sector, Furmanite's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Furmanite'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.
Furmanite (NYSE:FRM) 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
Furmanite had a gross margin of 26.32% for the quarter that ended in Sep. 2015 => 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.
Furmanite Gross Margin % Related Terms
Thank you for viewing the detailed overview of Furmanite's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Furmanite Corp was incorporated in Delaware on January 23, 1953. It provides specialized technical services. The Company together with its subsidiaries conducts business under two operating segments; Technical Services and Engineering & Project Solutions. Technical Services provides specialized technical services, including on-line, off-line and other services. On-line services include leak sealing, hot tapping, line stopping, line isolation, composite repair, valve testing and certain non-destructive testing and inspection services, while off-line services include on-site machining, heat treatment, bolting, valve repair and other non-destructive testing and inspection services. Other services include smart shim services, concrete repair, engineering services, valves and other products and manufacturing. These services and products are provided mainly to electric power generating plants, the petroleum industry, which includes refineries and off-shore drilling rigs, chemical plants and other process industries in the Americas, EMEA and Asia-Pacific through a wholly owned subsidiary of the Parent Company, Furmanite Worldwide, Inc. and its domestic and international subsidiaries and affiliates. The Engineering & Project Solutions operating segment, which includes Furmanite Technical Solutions, provides project planning, professional engineering, downstream non-destructive testing and inspection, construction management, mechanical integrity, field support, quality assurance and plant asset management services, as well as certain other inspection and project management services. Customers include refining and petrochemical operators as well as maintenance, and engineering and construction contractors servicing the downstream and midstream oil and gas markets, all of which are in the Americas. The Company currently operates over 30 offices in the United States. The Company competes against large and well established national and international companies as well as regional and local companies. It also competes with the in-house maintenance departments of customers or potential customers. Many aspects of the Company's operations are subject to governmental regulation.
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