Atlas African Industries (LSE:AAI) ROC % : -38.13% (As of Jun. 2016)

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What is Atlas African Industries ROC %?

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Atlas African Industries's annualized return on capital (ROC %) for the quarter that ended in Jun. 2016 was -38.13%.

As of today (2024-06-10), Atlas African Industries's WACC % is 0.00%. Atlas African Industries's ROC % is 0.00% (calculated using TTM income statement data). Atlas African Industries earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Atlas African Industries ROC % Historical Data

The historical data trend for Atlas African Industries's ROC % 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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Atlas African Industries ROC % Chart

Atlas African Industries Annual Data

Trend

Dec11

Dec12

Jun13

Jun14

ROC %

16.89

10.90

-17.83

Atlas African Industries Semi-Annual Data
	Dec11	Dec12	Dec13	Jun14	Dec14	Jun16
ROC %	Get a 7-Day Free Trial			-	-17.16	-11.57	-63.34	-38.13

Atlas African Industries ROC % Calculation

Atlas African Industries's annualized Return on Capital (ROC %) for the fiscal year that ended in Jun. 2014 is calculated as:

	ROC % (A: Jun. 2014 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Jun. 2013 )	+	Invested Capital (A: Jun. 2014 ))	/ count )
=	-0.859 * ( 1 - 0% )	/	( (0.234	+	9.399)	/ 2 )
=	-0.859	/	4.8165
=	-17.83 %

where

	Invested Capital		(A: Jun. 2013 )
=	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	))
=	6.471	-	0.328	-	( 5.909	-	max(0, 0.346	-	6.471	+	5.909	))
=	0.234

	Invested Capital		(A: Jun. 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	))
=	11.405	-	0.155	-	( 1.851	-	max(0, 0.223	-	3.251	+	1.851	))
=	9.399

Atlas African Industries's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2016 is calculated as:

	ROC % (Q: Jun. 2016 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2014 )	+	Invested Capital (Q: Jun. 2016 ))	/ count )
=	-2.92 * ( 1 - -0.07% )	/	( (11.983	+	3.344)	/ 2 )
=	-2.922044	/	7.6635
=	-38.13 %

where

	Invested Capital		(Q: 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	))
=	22.398	-	2.283	-	( 8.225	-	max(0, 2.321	-	10.453	+	8.225	))
=	11.983

	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	))
=	5.121	-	0.574	-	( 1.203	-	max(0, 0.574	-	2.943	+	1.203	))
=	3.344

Note: The Operating Income data used here is two times the semi-annual (Jun. 2016) data.

Atlas African Industries (LSE:AAI) ROC % Explanation

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. 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 ROC % 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, Atlas African Industries's WACC % is 0.00%. Atlas African Industries's ROC % is 0.00% (calculated using TTM income statement data). Atlas African Industries earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Be Aware

Like ROE % and ROA %, ROC % 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.

Atlas African Industries ROC % Related Terms

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Atlas African Industries (LSE:AAI) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Energy » Oil & Gas » Atlas African Industries Ltd (LSE:AAI) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

Website

http://www.atlassupport.com

Atlas African Industries Ltd, formerly known as Atlas Development & Support Services Ltd, was incorporated in Guernsey under the Law on December 5, 2012. The Company has a Joint Venture agreement with Ethiopian conglomerate Orchid Group to provide services in civil engineering and project management offering into industrial projects. The Company's operates in industrial division and support services division. Its 100% owned subsidiary, East Africa Packaging Holdings, is focused glass bottle manufacturing facility 45km north of Addis Ababa, Ethiopia known as the Chancho Project. The Chancho Project is in feasibility stage with a defined development strategy to construct and operate a glass bottle manufacturing facility. The JV provides services to clients in the natural resource development and infrastructure sectors, through civil engineering, project management, work-force accommodation solutions and on-going life support services.

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