ITO EN (TSE:2593) Gross Margin % : 39.09% (As of Jan. 2024)

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What is ITO EN Gross Margin %?

Gross Margin % is calculated as gross profit divided by its revenue. ITO EN's Gross Profit for the three months ended in Jan. 2024 was 円40,548 Mil. ITO EN's Revenue for the three months ended in Jan. 2024 was 円103,724 Mil. Therefore, ITO EN's Gross Margin % for the quarter that ended in Jan. 2024 was 39.09%.

Warning Sign:

ITO EN Ltd gross margin has been in long-term decline. The average rate of decline per year is -4.4%.

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

TSE:2593' s Gross Margin % Range Over the Past 10 Years
Min: 38.36 Med: 47.61 Max: 48.38
Current: 39.01

During the past 13 years, the highest Gross Margin % of ITO EN was 48.38%. The lowest was 38.36%. And the median was 47.61%.

TSE:2593's Gross Margin % is ranked better than
54.13% of 109 companies
in the Beverages - Non-Alcoholic industry
Industry Median: 37.31 vs TSE:2593: 39.01

ITO EN had a gross margin of 39.09% for the quarter that ended in Jan. 2024 => Competition eroding margins

The 5-Year average Growth Rate of Gross Margin for ITO EN was -4.40% per year.

ITO EN Gross Margin % Historical Data

The historical data trend for ITO EN'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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ITO EN Gross Margin % Chart

ITO EN Annual Data

Trend

Apr14

Apr15

Apr16

Apr17

Apr18

Apr19

Apr20

Apr21

Apr22

Apr23

Gross Margin %

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47.68

48.15

48.18

39.82

38.36

ITO EN Quarterly Data
	Apr19	Jul19	Oct19	Jan20	Apr20	Jul20	Oct20	Jan21	Apr21	Jul21	Oct21	Jan22	Apr22	Jul22	Oct22	Jan23	Apr23	Jul23	Oct23	Jan24
Gross Margin %	Get a 7-Day Free Trial															39.50	39.14	39.40	38.43	39.09

Competitive Comparison of ITO EN's Gross Margin %

For the Beverages - Non-Alcoholic subindustry, ITO EN'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.

ITO EN's Gross Margin % Distribution in the Beverages - Non-Alcoholic Industry

For the Beverages - Non-Alcoholic industry and Consumer Defensive sector, ITO EN's Gross Margin % distribution charts can be found below:

* The bar in red indicates where ITO EN's Gross Margin % falls into.

ITO EN Gross Margin % Calculation

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

ITO EN's Gross Margin for the fiscal year that ended in Apr. 2023 is calculated as

Gross Margin % (A: Apr. 2023 )	=	Gross Profit (A: Apr. 2023 )	/	Revenue (A: Apr. 2023 )
	=	165585	/	431674
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(431674 - 266089)	/	431674
	=	38.36 %

ITO EN's Gross Margin for the quarter that ended in Jan. 2024 is calculated as

Gross Margin % (Q: Jan. 2024 )	=	Gross Profit (Q: Jan. 2024 )	/	Revenue (Q: Jan. 2024 )
	=	40548	/	103724
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(103724 - 63176)	/	103724
	=	39.09 %

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.

ITO EN (TSE:2593) 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

ITO EN had a gross margin of 39.09% for the quarter that ended in Jan. 2024 => Competition eroding margins

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.

ITO EN Gross Margin % Related Terms

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ITO EN (TSE:2593) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Beverages - Non-Alcoholic » ITO EN Ltd (TSE:2593) » Definitions » Gross Margin %

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Traded in Other Exchanges

ITOEF:USA

Address

47-10, Honmachi 3-chome, Shibuya-ku, Tokyo, JPN, 151-8550

Website

https://www.itoen.co.jp

ITO EN Ltd makes beverages and other tea and nutritional products that it sells in Japan. Ito En primarily sells green tea products, including ready-to-drink beverages, tea bags, and other tea leaf products, under its Oi Ocha brand. Other beverages the company sells include black tea, Chinese tea, coffee, vegetable beverages, fruit beverages, mineral water, and functional beverages. The Leaf- and Drink-Related business segment makes up roughly 90% of the company's total revenue. Most remaining revenue is generated from Ito En's restaurant business, which operates hundreds of Tully's coffee shops in Japan.

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