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Wright Medical Group (FRA:WM3) Operating Income : €-99.1 Mil (TTM As of Jun. 2015)


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What is Wright Medical Group Operating Income?

Wright Medical Group's Operating Income for the three months ended in Jun. 2015 was €-30.6 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Jun. 2015 was €-99.1 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Wright Medical Group's Operating Income for the three months ended in Jun. 2015 was €-30.6 Mil. Wright Medical Group's Revenue for the three months ended in Jun. 2015 was €71.7 Mil. Therefore, Wright Medical Group's Operating Margin % for the quarter that ended in Jun. 2015 was -42.70%.

Wright Medical Group'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. Wright Medical Group's annualized ROC % for the quarter that ended in Jun. 2015 was -25.09%. Wright Medical Group's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2015 was -97.19%.


Wright Medical Group Operating Income Historical Data

The historical data trend for Wright Medical Group'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.

Wright Medical Group Operating Income Chart

Wright Medical Group Annual Data
Trend Dec05 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14
Operating Income
Get a 7-Day Free Trial Premium Member Only Premium Member Only 28.10 3.49 9.01 -206.01 -80.94

Wright Medical Group Quarterly Data
Sep10 Dec10 Mar11 Jun11 Sep11 Dec11 Mar12 Jun12 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15
Operating Income Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -21.47 -16.02 -21.85 -30.60 -30.60

Wright Medical Group 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 Jun. 2015 adds up the quarterly data reported by the company within the most recent 12 months, which was €-99.1 Mil.

* 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.


Wright Medical Group  (FRA:WM3) Operating Income Explanation

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

Wright Medical Group's annualized ROC % for the quarter that ended in Jun. 2015 is calculated as:

ROC % (Q: Jun. 2015 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Mar. 2015 ) + Invested Capital (Q: Jun. 2015 ))/ count )
=-122.396 * ( 1 - -0.43% )/( (501.678 + 478.058)/ 2 )
=-122.9223028/489.868
=-25.09 %

where

Invested Capital(Q: Mar. 2015 )
=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))
=1110.009 - 178.441 - ( 429.89 - max(0, 179.118 - 633.125+429.89))
=501.678

Invested Capital(Q: Jun. 2015 )
=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))
=1044.09 - 184.804 - ( 381.228 - max(0, 185.414 - 585.086+381.228))
=478.058

Note: The Operating Income data used here is four times the quarterly (Jun. 2015) data.

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

Wright Medical Group's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2015 is calculated as:

ROC (Joel Greenblatt) %(Q: Jun. 2015 )
=EBIT/Average of (Net fixed Assets + Net Working Capital)
=EBIT/Average of (Property, Plant and Equipment+Net Working Capital)
     Q: Mar. 2015  Q: Jun. 2015
=EBIT/( ( (Property, Plant and Equipment + Net Working Capital) + (Property, Plant and Equipment + Net Working Capital) )/ count )
=-122.396/( ( (100.579 + max(24.794, 0)) + (107.439 + max(19.053, 0)) )/ 2 )
=-122.396/( ( 125.373 + 126.492 )/ 2 )
=-122.396/125.9325
=-97.19 %

where Working Capital is:

Working Capital(Q: Mar. 2015 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(48.753 + 94.133 + 60.349) - (178.441 + 0 + 0)
=24.794

Working Capital(Q: Jun. 2015 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(45.561 + 98.174 + 60.123) - (184.804 + 0 + 0.00099999999997635)
=19.053

When net working capital is negative, 0 is used.

Note: The EBIT data used here is four times the quarterly (Jun. 2015) EBIT data.

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

Wright Medical Group's Operating Margin % for the quarter that ended in Jun. 2015 is calculated as:

Operating Margin %=Operating Income (Q: Jun. 2015 )/Revenue (Q: Jun. 2015 )
=-30.599/71.654
=-42.70 %

* 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.

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.


Wright Medical Group Operating Income Related Terms

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Wright Medical Group (FRA:WM3) Business Description

Traded in Other Exchanges
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Wright Medical Group Inc, through Wright Medical Technology, Inc. and other operating subsidiaries, is a specialty orthopaedic company, that provides extremity and biologic solutions that enable clinicians to alleviate pain and restore their patients' lifestyles. The Company provides surgical solutions for the foot and ankle market and markets its products in over 60 countries. Its business includes products that are used in foot and ankle repair, upper extremity products, and biologics products, which are used to replace damaged or diseased bone, to stimulate bone growth and to provide other biological solutions for surgeons and their patients. Extremity hardware includes implants and other devices to replace or reconstruct injured or diseased joints and bones of the foot, ankle, hand, wrist, fingers, toes, elbow and shoulder, which it generally refer to as either foot and ankle or upper extremity products. The Company's manufacturing and warehousing operations are located in Arlington, Tennessee. Outside the U.S., The Company has distribution and administrative facilities in Amsterdam, the Netherlands, and sales and distribution offices in Canada, Australia, and Europe. The Company operates its continuing operations as one reportable segment and offer products in extremity reconstruction and biologics. The Company's products include CHARLOTTE, CLAW II, DARCO, EVOLVE, MICRONAIL, GRAFTJACKET, OSTEOSET. Its competitors include major companies in the orthopaedic and biologics industries, as well as academic institutions and other public and private research organizations that continue to conduct research, seek patent protection and establish arrangements for commercializing products. The Company's products are strictly regulated by the FDA under the Food, Drug, and Cosmetic Act. Some of its products are also regulated by state agencies.

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