Coastal Contacts (FRA:C9R1) Operating Income : €-12.3 Mil (TTM As of Jan. 2014)

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What is Coastal Contacts Operating Income?

Coastal Contacts's Operating Income for the three months ended in Jan. 2014 was €-3.2 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Jan. 2014 was €-12.3 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Coastal Contacts's Operating Income for the three months ended in Jan. 2014 was €-3.2 Mil. Coastal Contacts's Revenue for the three months ended in Jan. 2014 was €35.0 Mil. Therefore, Coastal Contacts's Operating Margin % for the quarter that ended in Jan. 2014 was -9.11%.

Coastal Contacts's 5-Year average Growth Rate for Operating Margin % was 0.00% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. Coastal Contacts's annualized ROC % for the quarter that ended in Jan. 2014 was -46.84%. Coastal Contacts's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jan. 2014 was -172.61%.

Coastal Contacts Operating Income Historical Data

The historical data trend for Coastal Contacts's Operating Income 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.

Coastal Contacts Operating Income Chart

Coastal Contacts Annual Data

Trend

Oct04

Oct05

Oct06

Oct07

Oct08

Oct09

Oct10

Oct11

Oct12

Oct13

Operating Income

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3.03

2.29

-3.56

-2.73

-10.60

Coastal Contacts Quarterly Data
	Apr09	Jul09	Oct09	Jan10	Apr10	Jul10	Oct10	Jan11	Apr11	Jul11	Oct11	Jan12	Apr12	Jul12	Oct12	Jan13	Apr13	Jul13	Oct13	Jan14
Operating Income	Get a 7-Day Free Trial															-2.04	-5.09	-2.43	-1.57	-3.18

Coastal Contacts Operating Income Calculation

Operating Income, is the profit a company earned through operations. All expenses, including cash expenses such as cost of goods sold (COGS), research & development, wages, and non-cash expenses, such as depreciation, depletion and amortization, have been deducted from the sales.

Operating Income for the trailing twelve months (TTM) ended in Jan. 2014 adds up the quarterly data reported by the company within the most recent 12 months, which was €-12.3 Mil.

Coastal Contacts (FRA:C9R1) Operating Income Explanation

1. Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition.

Coastal Contacts's annualized ROC % for the quarter that ended in Jan. 2014 is calculated as:

	ROC % (Q: Jan. 2014 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Oct. 2013 )	+	Invested Capital (Q: Jan. 2014 ))	/ count )
=	-12.736 * ( 1 - -0.18% )	/	( (27.92	+	26.557)	/ 2 )
=	-12.7589248	/	27.2385
=	-46.84 %

where

	Invested Capital		(Q: Oct. 2013 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	65.965	-	31.006	-	( 15.718	-	max(0, 36.124	-	43.163	+	15.718	))
=	27.92

	Invested Capital		(Q: Jan. 2014 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	59.624	-	28.775	-	( 9.079	-	max(0, 32.599	-	36.891	+	9.079	))
=	26.557

Note: The Operating Income data used here is four times the quarterly (Jan. 2014) data.

2. Joel Greenblatt's definition of Return on Capital:

Coastal Contacts's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jan. 2014 is calculated as:

	ROC (Joel Greenblatt) %		(Q: Jan. 2014 )
=	EBIT	/	Average of (Net fixed Assets	+	Net Working Capital)
=	EBIT	/	Average of (Property, Plant and Equipment	+	Net Working Capital)
			Q: Oct. 2013		Q: Jan. 2014
=	EBIT	/	( ( (Property, Plant and Equipment + Net Working Capital)	+	(Property, Plant and Equipment + Net Working Capital) )	/	count )
=	-12.736	/	( ( (7.459 + max(-5.444, 0))	+	(7.298 + max(-7.715, 0)) )	/	2 )
=	-12.736	/	( ( 7.459	+	7.298 )	/	2 )
=	-12.736	/	7.3785
=	-172.61 %

where Working Capital is:

	Working Capital		(Q: Oct. 2013 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(4.663	+	20.508	+	1.944)	-	(31.006	+	0	+	1.553)
=	-5.444

	Working Capital		(Q: Jan. 2014 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(0	+	20.185	+	2.59)	-	(28.775	+	0	+	1.715)
=	-7.715

When net working capital is negative, 0 is used.

Note: The EBIT data used here is four times the quarterly (Jan. 2014) EBIT data.

3. Operating Income is also linked to Operating Margin %:

Coastal Contacts's Operating Margin % for the quarter that ended in Jan. 2014 is calculated as:

Operating Margin %	=	Operating Income (Q: Jan. 2014 )	/	Revenue (Q: Jan. 2014 )
	=	-3.184	/	34.959
	=	-9.11 %

4. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Operating Income growth rate using Operating Income per share data.

Be Aware

Compared with a company's EBITDA margin, Operating Margin can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin may decline. Often the Operating Margin declines well before the company's revenue or even profit decline. Therefore, Operating Margin is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia's Operating Margin had already been in decline since 2002, although its earnings per share were still rising. Investors who paid attention to Operating Margin would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.

Coastal Contacts Operating Income Related Terms

Thank you for viewing the detailed overview of Coastal Contacts's Operating Income provided by GuruFocus.com. Please click on the following links to see related term pages.

Coastal Contacts (FRA:C9R1) Business Description

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GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » Coastal Contacts Inc (FRA:C9R1) » Definitions » Operating Income

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Website

http://www.coastalcontacts.com

Coastal Contacts Inc. was incorporated under the Canada Business Corporations Act on December 14, 2000. The Company is an online retailer of vision care products. It is a direct-to-consumer retailer of vision care products and services. The Company sells contact lenses, eyeglasses and related products mainly through the Company's internet websites, although customers may also place orders over the telephone. It has operations and distribution centers in North America, Europe and Australia. The Company sells contact lenses manufactured by multinational companies such as Johnson and Johnson Inc., CIBA Vision Corporation (a division of Alcon), Bausch & Lomb Inc. and Coopervision Inc. It sells eyeglasses, which are mainly assembled in the Company's own laboratories, composed of frames and lenses purchased from a variety of different suppliers. The frames it uses in its eyeglasses include both branded frames and the Company's own private label frames such as Derek Cardigan, Kam Dhillon, Ltede and Joseph Marc. The Company also sells a variety of vision related products such as sunglasses and contact lens solutions including its own Healthy Eyes brand multipurpose contact lens solution for soft contact lenses. It offers substantially all of the soft contact lenses produced by the contact lens manufacturers, including Johnson & Johnson Inc., CIBA Vision Corporation, Bausch & Lomb Inc. and Coopervision Inc. The Company conducts all of its product fulfillment operations from the Company's distribution facilities in Vancouver, British Columbia, Canada; Stockholm, Sweden; Blaine, Washington and Sydney, Australia.

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