Gem Diamonds (LSE:GEMD) Gross Margin % : 19.57% (As of Dec. 2023)

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What is Gem Diamonds Gross Margin %?

Gross Margin % is calculated as gross profit divided by its revenue. Gem Diamonds's Gross Profit for the six months ended in Dec. 2023 was £10.6 Mil. Gem Diamonds's Revenue for the six months ended in Dec. 2023 was £54.1 Mil. Therefore, Gem Diamonds's Gross Margin % for the quarter that ended in Dec. 2023 was 19.57%.

Warning Sign:

Gem Diamonds Ltd gross margin has been in long-term decline. The average rate of decline per year is -7.4%.

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

LSE:GEMD' s Gross Margin % Range Over the Past 10 Years
Min: 22.22 Med: 39.88 Max: 50.9
Current: 22.23

During the past 13 years, the highest Gross Margin % of Gem Diamonds was 50.90%. The lowest was 22.22%. And the median was 39.88%.

LSE:GEMD's Gross Margin % is ranked better than
55.05% of 703 companies
in the Metals & Mining industry
Industry Median: 19.17 vs LSE:GEMD: 22.23

Gem Diamonds had a gross margin of 19.57% for the quarter that ended in Dec. 2023 => No sustainable competitive advantage

The 5-Year average Growth Rate of Gross Margin for Gem Diamonds was -7.40% per year.

Gem Diamonds Gross Margin % Historical Data

The historical data trend for Gem Diamonds'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.

* Premium members only.

Gem Diamonds Gross Margin % Chart

Gem Diamonds Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Gross Margin %

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28.87

39.99

39.77

34.31

22.22

Gem Diamonds Semi-Annual Data
	Jun14	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
Gross Margin %	Get a 7-Day Free Trial															34.42	32.54	36.30	24.76	19.57

Competitive Comparison of Gem Diamonds's Gross Margin %

For the Other Precious Metals & Mining subindustry, Gem Diamonds'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.

Gem Diamonds's Gross Margin % Distribution in the Metals & Mining Industry

For the Metals & Mining industry and Basic Materials sector, Gem Diamonds's Gross Margin % distribution charts can be found below:

* The bar in red indicates where Gem Diamonds's Gross Margin % falls into.

Gem Diamonds Gross Margin % Calculation

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

Gem Diamonds's Gross Margin for the fiscal year that ended in Dec. 2023 is calculated as

Gross Margin % (A: Dec. 2023 )	=	Gross Profit (A: Dec. 2023 )	/	Revenue (A: Dec. 2023 )
	=	24.6	/	110.827
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(110.827 - 86.199)	/	110.827
	=	22.22 %

Gem Diamonds's Gross Margin for the quarter that ended in Dec. 2023 is calculated as

Gross Margin % (Q: Dec. 2023 )	=	Gross Profit (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	10.6	/	54.134
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(54.134 - 43.541)	/	54.134
	=	19.57 %

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.

Gem Diamonds (LSE:GEMD) 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

Gem Diamonds had a gross margin of 19.57% for the quarter that ended in Dec. 2023 => No sustainable 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.

Gem Diamonds Gross Margin % Related Terms

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Gem Diamonds (LSE:GEMD) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Metals & Mining » Gem Diamonds Ltd (LSE:GEMD) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

GMDMF:USA GEMDl:UK ZVW:Germany

Address

2 Eaton Gate, London, GBR, SW1W 9BJ

Website

https://www.gemdiamonds.com

Gem Diamonds Ltd is a United Kingdom-based company engaged in the exploration and development of diamond mines. The company's geographical segments include Lesotho (diamond mining activities); Belgium (sales, marketing, and manufacturing of diamonds); and BVI, RSA, the UK, and Cyprus (technical and administrative services). It generates maximum revenue from the Belgium region. Its projects include Letseng Diamond mine and Ghaghoo Diamond mine. The company's revenue is derived from mining activities, polished manufacturing margins, and diamond analysis and manufacturing services.

Gem Diamonds (LSE:GEMD) Headlines

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