Spear REIT (JSE:SEA) Gross Margin % : 65.47% (As of Aug. 2023)

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What is Spear REIT Gross Margin %?

Gross Margin % is calculated as gross profit divided by its revenue. Spear REIT's Gross Profit for the six months ended in Aug. 2023 was R192.3 Mil. Spear REIT's Revenue for the six months ended in Aug. 2023 was R293.7 Mil. Therefore, Spear REIT's Gross Margin % for the quarter that ended in Aug. 2023 was 65.47%.

Warning Sign:

Spear REIT Ltd gross margin has been in long-term decline. The average rate of decline per year is -1.3%.

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

JSE:SEA' s Gross Margin % Range Over the Past 10 Years
Min: 65.85 Med: 69.66 Max: 72.46
Current: 65.85

During the past 7 years, the highest Gross Margin % of Spear REIT was 72.46%. The lowest was 65.85%. And the median was 69.66%.

JSE:SEA's Gross Margin % is ranked worse than
56.89% of 631 companies
in the REITs industry
Industry Median: 68.98 vs JSE:SEA: 65.85

Spear REIT had a gross margin of 65.47% for the quarter that ended in Aug. 2023 => Durable competitive advantage

The 5-Year average Growth Rate of Gross Margin for Spear REIT was -1.30% per year.

Spear REIT Gross Margin % Historical Data

The historical data trend for Spear REIT'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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Spear REIT Gross Margin % Chart

Spear REIT Annual Data

Trend

Feb17

Feb18

Feb19

Feb20

Feb21

Feb22

Feb23

Gross Margin %

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67.33

69.81

69.66

65.91

65.87

Spear REIT Semi-Annual Data
	Feb17	Aug17	Feb18	Aug18	Feb19	Aug19	Feb20	Aug20	Feb21	Aug21	Feb22	Aug22	Feb23	Aug23
Gross Margin %	Get a 7-Day Free Trial									67.76	64.08	65.51	66.23	65.47

Competitive Comparison of Spear REIT's Gross Margin %

For the REIT - Diversified subindustry, Spear REIT'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.

Spear REIT's Gross Margin % Distribution in the REITs Industry

For the REITs industry and Real Estate sector, Spear REIT's Gross Margin % distribution charts can be found below:

* The bar in red indicates where Spear REIT's Gross Margin % falls into.

Spear REIT Gross Margin % Calculation

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

Spear REIT's Gross Margin for the fiscal year that ended in Feb. 2023 is calculated as

Gross Margin % (A: Feb. 2023 )	=	Gross Profit (A: Feb. 2023 )	/	Revenue (A: Feb. 2023 )
	=	382.1	/	580.153
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(580.153 - 198.023)	/	580.153
	=	65.87 %

Spear REIT's Gross Margin for the quarter that ended in Aug. 2023 is calculated as

Gross Margin % (Q: Aug. 2023 )	=	Gross Profit (Q: Aug. 2023 )	/	Revenue (Q: Aug. 2023 )
	=	192.3	/	293.699
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(293.699 - 101.428)	/	293.699
	=	65.47 %

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.

Spear REIT (JSE:SEA) 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

Spear REIT had a gross margin of 65.47% for the quarter that ended in Aug. 2023 => Durable 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.

Spear REIT Gross Margin % Related Terms

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Spear REIT (JSE:SEA) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » REITs » Spear REIT Ltd (JSE:SEA) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

N/A

Address

2 Long Street, PO Box 50, 16th Floor, Cape Town, ZAF, 8001

Website

https://www.spearprop.co.za

Spear REIT Ltd is a real estate investment trust. The company is a diversified property investment company investing in real estate sectors including office, retail, industrial, residential, and hospitality. Its operating business segments are Industrial, Commercial, Retail, Hospitality, Residential, Development, and Non-property. The segments derive their revenue mainly from rental income from leases. The company derives maximum revenue from the Industrial segment.

Spear REIT (JSE:SEA) Headlines

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