Langfang Development Co (SHSE:600149) Gross Margin % : 8.74% (As of Dec. 2023)

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What is Langfang Development Co Gross Margin %?

Gross Margin % is calculated as gross profit divided by its revenue. Langfang Development Co's Gross Profit for the three months ended in Dec. 2023 was ¥7.5 Mil. Langfang Development Co's Revenue for the three months ended in Dec. 2023 was ¥85.5 Mil. Therefore, Langfang Development Co's Gross Margin % for the quarter that ended in Dec. 2023 was 8.74%.

Warning Sign:

Langfang Development Co Ltd gross margin has been in long-term decline. The average rate of decline per year is -12.6%.

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

SHSE:600149' s Gross Margin % Range Over the Past 10 Years
Min: 0.94 Med: 16.22 Max: 35.95
Current: 7.8

During the past 13 years, the highest Gross Margin % of Langfang Development Co was 35.95%. The lowest was 0.94%. And the median was 16.22%.

SHSE:600149's Gross Margin % is ranked worse than
88.52% of 2439 companies
in the Hardware industry
Industry Median: 24.5 vs SHSE:600149: 7.80

Langfang Development Co had a gross margin of 8.74% for the quarter that ended in Dec. 2023 => No sustainable competitive advantage

The 5-Year average Growth Rate of Gross Margin for Langfang Development Co was -12.60% per year.

Langfang Development Co Gross Margin % Historical Data

The historical data trend for Langfang Development Co'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.

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Langfang Development Co Gross Margin % Chart

Langfang Development Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Gross Margin %

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31.32

35.95

19.82

8.73

7.80

Langfang Development Co Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Gross Margin %	Get a 7-Day Free Trial															12.71	3.57	44.76	-11.95	8.74

Competitive Comparison of Langfang Development Co's Gross Margin %

For the Electronics & Computer Distribution subindustry, Langfang Development Co'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.

Langfang Development Co's Gross Margin % Distribution in the Hardware Industry

For the Hardware industry and Technology sector, Langfang Development Co's Gross Margin % distribution charts can be found below:

* The bar in red indicates where Langfang Development Co's Gross Margin % falls into.

Langfang Development Co Gross Margin % Calculation

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

Langfang Development Co's Gross Margin for the fiscal year that ended in Dec. 2023 is calculated as

Gross Margin % (A: Dec. 2023 )	=	Gross Profit (A: Dec. 2023 )	/	Revenue (A: Dec. 2023 )
	=	15.2	/	195.011
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(195.011 - 179.801)	/	195.011
	=	7.80 %

Langfang Development Co'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 )
	=	7.5	/	85.455
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(85.455 - 77.987)	/	85.455
	=	8.74 %

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.

Langfang Development Co (SHSE:600149) 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

Langfang Development Co had a gross margin of 8.74% for the quarter that ended in Dec. 2023 => No sustainable 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.

Langfang Development Co Gross Margin % Related Terms

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Langfang Development Co (SHSE:600149) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Hardware » Langfang Development Co Ltd (SHSE:600149) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

N/A

Address

No. 3 Yongfeng Road, Floor 22, Block B, Langfang Development Building, Guangyang District, Hebei Province, Langfang, CHN, 065000

Website

Langfang Development Co Ltd is a China-based company primarily engaged in distribution of electronic products and the provision of network technology services.

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