eFuture Holding (eFuture Holding) ROIC % : -14.07% (As of Sep. 2016)

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What is eFuture Holding ROIC %?

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. eFuture Holding's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2016 was -14.07%.

As of today (2024-04-26), eFuture Holding's WACC % is 0.00%. eFuture Holding's ROIC % is 0.00% (calculated using TTM income statement data). eFuture Holding earns returns that do not match up to its cost of capital. It will destroy value as it grows.

eFuture Holding ROIC % Historical Data

The historical data trend for eFuture Holding's ROIC % 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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eFuture Holding ROIC % Chart

eFuture Holding Annual Data

Trend

Dec06

Dec07

Dec08

Dec09

Dec10

Dec11

Dec12

Dec13

Dec14

Dec15

ROIC %

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-11.62

352.99

-4.90

3.69

3.64

eFuture Holding Quarterly Data
	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13	Sep13	Dec13	Mar14	Jun14	Sep14	Dec14	Mar15	Jun15	Sep15	Dec15	Mar16	Jun16	Sep16
ROIC %	Get a 7-Day Free Trial															-8.10	43.95	-24.90	-13.82	-14.07

Competitive Comparison of eFuture Holding's ROIC %

For the Software - Application subindustry, eFuture Holding's ROIC %, along with its competitors' market caps and ROIC % 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.

eFuture Holding's ROIC % Distribution in the Software Industry

For the Software industry and Technology sector, eFuture Holding's ROIC % distribution charts can be found below:

* The bar in red indicates where eFuture Holding's ROIC % falls into.

eFuture Holding ROIC % Calculation

eFuture Holding's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2015 is calculated as:

	ROIC % (A: Dec. 2015 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2014 )	+	Invested Capital (A: Dec. 2015 ))	/ count )
=	1.31 * ( 1 - 17.86% )	/	( (30.493	+	28.691)	/ 2 )
=	1.076034	/	29.592
=	3.64 %

where

	Invested Capital		(A: Dec. 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	))
=	42.673	-	11.322	-	( 10.432	-	max(0, 21.597	-	22.455	+	10.432	))
=	30.493

	Invested Capital		(A: Dec. 2015 )
=	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	))
=	48.404	-	12.681	-	( 14.987	-	max(0, 22.557	-	29.589	+	14.987	))
=	28.691

eFuture Holding's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Sep. 2016 is calculated as:

	ROIC % (Q: Sep. 2016 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2016 )	+	Invested Capital (Q: Sep. 2016 ))	/ count )
=	-3.144 * ( 1 - -23.26% )	/	( (27.226	+	27.875)	/ 2 )
=	-3.8752944	/	27.5505
=	-14.07 %

where

	Invested Capital		(Q: Jun. 2016 )
=	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	))
=	38.333	-	5.638	-	( 5.574	-	max(0, 15.041	-	20.51	+	5.574	))
=	27.226

	Invested Capital		(Q: Sep. 2016 )
=	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	))
=	38.25	-	5.29	-	( 5.275	-	max(0, 16.158	-	21.243	+	5.275	))
=	27.875

Note: The Operating Income data used here is four times the quarterly (Sep. 2016) data.

eFuture Holding (NAS:EFUT) ROIC % Explanation

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.

There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.

Why is ROIC % important?

Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.

As of today, eFuture Holding's WACC % is 0.00%. eFuture Holding's ROIC % is 0.00% (calculated using TTM income statement data).

Be Aware

Like ROE % and ROA %, ROIC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.

eFuture Holding ROIC % Related Terms

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eFuture Holding (eFuture Holding) Business Description

Industry

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Comparable Companies

Traded in Other Exchanges

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Address

Website

http://www.e-future.com.cn

E-Future Information Technology, Inc., established under the Cayman Islands Companies Law on November 2, 2000. The Company changed its name from 'e-Future Information Technology Inc.' to 'eFuture Information Technology Inc.' in December 2008. It provides software and services to China's retail and consumer goods industries. It offers one-stop, end-to-end integrated portfolio of software and services from factory to consumer on seven verticals: Fast Moving Consumer Goods (FMCG), Department Store, Shopping Mall, Grocery, Logistics, Specialty Store and Online Retailers. Its clients include manufacturers, distributors, resellers, logistics companies and retailers. The Company's client base encompasses corporations such as Procter & Gamble, Pepsi, L'Oreal, Kimberly-Clark, Gucci and B&Q as well as Chinese companies. The Company has three business lines: software, professional services and cloud service. Its software solutions include the management of merchandizing, distribution, warehousing, supply chains, customer relationships, logistics and points of sale. It consists of three deployable groups of products: Foundation Solutions, Collaborative Solutions and Intelligent Solutions. Foundation Solutions - are used to meet client needs for services such as retail management, point of sale ('POS'), distribution management, logistics management, warehouse management, vendor payment and control and loyalty card management. Collaborative Solutions - are used to meet client needs for services such as visual SCM and visual process management systems. Depending on the type of customer and their needs, clients use a variety of Collaborative Solutions. Intelligent Solutions - are used to meet client needs for services such as business intelligence, brand analysis, supplier relationship management and customer relationship management systems. Professional Services includes recurring maintenance and support services on existing software installations, delivery services, consulting services and outsourcing services. Maintenance and Support Service - is provided following the installation of its software solutions, as clients will typically require ongoing maintenance support and software upgrades to ensure the efficient operation of their system. Consulting Service - is provided by its consulting services group which consists of business consultants, systems analysts and technical personnel. Outsourcing Service - is flexible by design to meet its clients' changing requirements. Cloud Service consists of cloud services based on cloud computing architecture, such as Salesforce Automation. Its regional service centers in Beijing, Shanghai, Guangzhou, Wuhan, Qingdao, Xi'an, Fuzhou, Hangzhou, Nanjing, Chongqing and Shenzhen.