Endocoal (ASX:EOC) ROCE % : -18.70% (As of Dec. 2012)

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What is Endocoal ROCE %?

ROCE % measures how well a company generates profits from its capital. It is calculated as EBIT divided by Capital Employed, where Capital Employed is calculated as Total Assets minus Total Current Liabilities. Endocoal's annualized ROCE % for the quarter that ended in Dec. 2012 was -18.70%.

Endocoal ROCE % Historical Data

The historical data trend for Endocoal's ROCE % 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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Endocoal ROCE % Chart

Endocoal Annual Data

Trend

Jun09

Jun10

Jun11

Jun12

ROCE %

-17.53

-11.19

-12.77

Endocoal Quarterly Data
	Dec10	Jun11	Dec11	Jun12	Dec12
ROCE %	-23.08	-25.40	-29.31	-23.89	-18.70

Endocoal ROCE % Calculation

Endocoal's annualized ROCE % for the fiscal year that ended in Jun. 2012 is calculated as:

ROCE %	=	EBIT	/	( (Capital Employed	+	Capital Employed)	/ count )
		(A: Jun. 2012 )		(A: Jun. 2011 )		(A: Jun. 2012 )
	=	EBIT	/	( ( (Total Assets - Total Current Liabilities)	+	(Total Assets - Total Current Liabilities) )	/ count )
		(A: Jun. 2012 )		(A: Jun. 2011 )		(A: Jun. 2012 )
	=	-4.077	/	( ( (27.034 - 2.959)	+	(42.492 - 2.707) )	/ 2 )
	=	-4.077	/	( (24.075	+	39.785)	/ 2 )
	=	-4.077	/	31.93
	=	-12.77 %

Endocoal's ROCE % of for the quarter that ended in Dec. 2012 is calculated as:

ROCE %	=	EBIT ⁽¹⁾	/	( (Capital Employed	+	Capital Employed)	/ count )
		(Q: Dec. 2012 )		(Q: Jun. 2012 )		(Q: Dec. 2012 )
	=	EBIT	/	( ( (Total Assets - Total Current Liabilities)	+	(Total Assets - Total Current Liabilities) )	/ count )
		(Q: Dec. 2012 )		(Q: Jun. 2012 )		(Q: Dec. 2012 )
	=	-7.272	/	( ( (42.492 - 2.707)	+	(39.828 - 1.854) )	/ 2 )
	=	-7.272	/	( ( 39.785	+	37.974 )	/ 2 )
	=	-7.272	/	38.8795
	=	-18.70 %

(1) Note: The EBIT data used here is four times the quarterly (Dec. 2012) EBIT data.

Endocoal (ASX:EOC) ROCE % Explanation

ROCE % can be especially useful when comparing the performance of capital-intensive companies. Unlike ROE %, which indicates the profitability of Shareholders Equity, ROCE % also considers long-term debt in Capital Employed. This can be helpful when analyzing companies with significant debt, as the result is neutralized by taking debt into consideration.

Generally speaking, a higher ROCE % indicates a stonger profitability for a company. Moreover, it is important to look at the ratio from a long term perspective. Investors tend to favor companies with stable and rising ROCE % trend over those with volatile ones.

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Endocoal (ASX:EOC) Business Description

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