Max Petroleum (LSE:MXP) Operating Income: £9.09 Mil (TTM As of Sep. 2014)

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What is Max Petroleum Operating Income?

Max Petroleum LSE:MXP Operating Income is £9.09 Mil as of Sep. 2014. The stock has 6 warning signs investors should review.

Max Petroleum's Operating Income for the six months ended in Sep. 2014 was £7.13 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Sep. 2014 was £9.09 Mil.

Warning Sign:

Max Petroleum PLC had operating loss over the past 0.75 years.

Operating Margin % is calculated as Operating Income divided by its Revenue. Max Petroleum's Operating Income for the six months ended in Sep. 2014 was £7.13 Mil. Max Petroleum's Revenue for the six months ended in Sep. 2014 was £33.23 Mil. Therefore, Max Petroleum's Operating Margin % for the quarter that ended in Sep. 2014 was 21.46%.

Warning Sign:

Max Petroleum PLC operating margin has been in 5-year decline. The average rate of decline per year is -20.1%.

Max Petroleum's 5-Year average Growth Rate for Operating Margin % was -20.10% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. Max Petroleum's annualized ROC % for the quarter that ended in Sep. 2014 was 7.50%. Max Petroleum's annualized ROC (Joel Greenblatt) % for the quarter that ended in Sep. 2014 was 10.90%.

Max Petroleum  (LSE:MXP) Operating Income Explanation

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

Max Petroleum's annualized ROC % for the quarter that ended in Sep. 2014 is calculated as:

ROC % (Q: Sep. 2014 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Mar. 2014 ) + Invested Capital (Q: Sep. 2014 ))/ count )
=14.258 * ( 1 - 0% )/( (210.096 + 170.142)/ 2 )
=14.258/190.119
=7.50 %

where

Invested Capital(Q: Mar. 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))
=163.654 - 23.063 - ( 0.317 - max(0, 77.874 - 8.369+0.317))
=210.096

Invested Capital(Q: Sep. 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))
=165.139 - 26.706 - ( 2.263 - max(0, 41.652 - 9.943+2.263))
=170.142

Note: The Operating Income data used here is two times the semi-annual (Sep. 2014) data.

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

Max Petroleum's annualized ROC (Joel Greenblatt) % for the quarter that ended in Sep. 2014 is calculated as:

ROC (Joel Greenblatt) %(Q: Sep. 2014 )
=EBIT/Average of (Net fixed Assets + Net Working Capital)
=EBIT/Average of (Property, Plant and Equipment+Net Working Capital)
     Q: Mar. 2014  Q: Sep. 2014
=EBIT/( ( (Property, Plant and Equipment + Net Working Capital) + (Property, Plant and Equipment + Net Working Capital) )/ count )
=5.108/( ( (15.298 + max(-22.011, 0)) + (78.419 + max(-23.957, 0)) )/ 2 )
=5.108/( ( 15.298 + 78.419 )/ 2 )
=5.108/46.8585
=10.90 %

where Working Capital is:

Working Capital(Q: Mar. 2014 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(0 + 3.314 + 0) - (23.063 + 0 + 2.262)
=-22.011

Working Capital(Q: Sep. 2014 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(0 + 3.746 + -0.00099999999999945) - (26.706 + 0 + 0.996)
=-23.957

When net working capital is negative, 0 is used.

Note: The EBIT data used here is two times the semi-annual (Sep. 2014) EBIT data.

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

Max Petroleum's Operating Margin % for the quarter that ended in Sep. 2014 is calculated as:

Operating Margin %=Operating Income (Q: Sep. 2014 )/Revenue (Q: Sep. 2014 )
=7.129/33.225
=21.46 %

* 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.

Max Petroleum Operating Income Related Terms

Max Petroleum Operating Income Historical Data

* Premium members only.

The historical data trend for Max Petroleum'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.

Max Petroleum Operating Income Chart

Max Petroleum Annual Data
Trend Mar06 Mar07 Mar08 Mar09 Mar10 Mar11 Mar12 Mar13 Mar14
Operating Income
Get a 7-Day Free Trial Premium Member Only 61.60 -3.19 -3.44 -0.78 1.54

Max Petroleum Semi-Annual Data
Sep06 Mar07 Sep07 Mar08 Sep08 Mar09 Sep09 Mar10 Sep10 Mar11 Sep11 Mar12 Sep12 Mar13 Sep13 Mar14 Sep14
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 1.46 -2.34 -0.44 1.96 7.13

Max Petroleum 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 Sep. 2014 adds up the semi-annually data reported by the company within the most recent 12 months, which was £9.09 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.

Frequently Asked Questions Learn more about Operating Income →
What does a Operating Income of £9.09 Mil mean?
Max Petroleum (LSE:MXP) has a Operating Income of £9.09 Mil as of Sep. 2014. Operating Income equals sales less all operating expenses. It is linked to EBIT. View historical data on Max Petroleum and its competitors.
Is Max Petroleum's Operating Income too high?
Max Petroleum's current Operating Income is £9.09 Mil.
How does Max Petroleum's Operating Income compare to competitors?
Max Petroleum's Operating Income of £9.09 Mil can be compared against companies in the Oil & Gas industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Operating Income for an Oil & Gas company?
A good Operating Income depends on the Oil & Gas industry context. However, Operating Income should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Operating Income mean?
A high Operating Income can signal that a stock is expensive relative to its fundamentals. Operating Income equals sales less all operating expenses. It is linked to EBIT. View historical data on Max Petroleum and its competitors. Max Petroleum's current Operating Income is £9.09 Mil. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Max Petroleum stock overvalued right now?
Max Petroleum (LSE:MXP) has a current Operating Income of £9.09 Mil. The current Operating Income is £9.09 Mil. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Operating Income calculated?
Operating Income is calculated from a company's financial statements. For Max Petroleum (LSE:MXP), the current Operating Income is £9.09 Mil as of Sep. 2014. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.

Max Petroleum Business Description

Industry EnergyOil & Gas
Address 4th Floor, Ergon House, Dean Bradley Street, London, GBR, SW1P 2AL
Max Petroleum Plc is an independent oil and gas exploration and production company. The company is engaged in the business of exploration, development, and production of oil and gas assets within the Republic of Kazakhstan. The group owns the exploration and production rights to the Blocks A&E License, which comprises two onshore blocks extending over 12,455 km2 in the Pre-Caspian Basin in Western Kazakhstan.