I'm trying to work out the gross profit for a shipping company Navios maritime partners.
I'd like to know what to include in the equation.
Revenue for 2012 Q3 was $49,122,000. In the shipping industry this is known as Time Charter Revenue
Time Charter expense was $3,923,000
Direct vessel expense was $13,000
Management fee was $7,323,000
So Gross profit is (revenue - cost of goods sold)
Which items should I include in the cogs? I think many analysis websites are only using Time Charter Expense + Direct vessel expense OR Time charter expense only.
But I had a read through the annual report and it says the following about management fee:
"The fixed management fee covers vessel operating expenses, which include crewing, repairs and maintenance, insurance and dry docking. The manager is directly responsible for providing all these items and services."
Now these expenses are important right? I mean without a crew the ship can't sail, if there's no insurance than the chartering company won't use that ship to move its cargo etc...?
So I should include them in my analysis? I'm tracking the gross profit margin over the last 6 years to see how its grown so I need to be as accurate as possible.
I tried going into the annual report and see if the management actually mentioned gross profit so I could see which items they included but there is no mention of it, and I don't want to take the word of websites like seeking alpha and yahoo finance statistics ( these seem to be too generic )
Thanks in advance guys