Munshaat Real Estate Projects Co KSCC (KUW:MUNSHAAT) ROIC % : 7.40% (As of Mar. 2024)

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What is Munshaat Real Estate Projects Co KSCC 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 %. Munshaat Real Estate Projects Co KSCC's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2024 was 7.40%.

As of today (2024-05-26), Munshaat Real Estate Projects Co KSCC's WACC % is 7.40%. Munshaat Real Estate Projects Co KSCC's ROIC % is 7.10% (calculated using TTM income statement data). Munshaat Real Estate Projects Co KSCC earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Munshaat Real Estate Projects Co KSCC ROIC % Historical Data

The historical data trend for Munshaat Real Estate Projects Co KSCC'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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Munshaat Real Estate Projects Co KSCC ROIC % Chart

Munshaat Real Estate Projects Co KSCC Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROIC %

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0.03

-5.83

-5.35

0.47

7.01

Munshaat Real Estate Projects Co KSCC Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
ROIC %	Get a 7-Day Free Trial															5.39	11.53	4.47	4.96	7.40

Competitive Comparison of Munshaat Real Estate Projects Co KSCC's ROIC %

For the Real Estate Services subindustry, Munshaat Real Estate Projects Co KSCC'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.

Munshaat Real Estate Projects Co KSCC's ROIC % Distribution in the Real Estate Industry

For the Real Estate industry and Real Estate sector, Munshaat Real Estate Projects Co KSCC's ROIC % distribution charts can be found below:

* The bar in red indicates where Munshaat Real Estate Projects Co KSCC's ROIC % falls into.

Munshaat Real Estate Projects Co KSCC ROIC % Calculation

Munshaat Real Estate Projects Co KSCC's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROIC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	6.168 * ( 1 - 3.85% )	/	( (89.5	+	79.768)	/ 2 )
=	5.930532	/	84.634
=	7.01 %

where

	Invested Capital		(A: Dec. 2022 )
=	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	))
=	90.403	-	24.835	-	( 8.014	-	max(0, 35.432	-	11.5	+	8.014	))
=	89.5

	Invested Capital		(A: Dec. 2023 )
=	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	))
=	86.243	-	12.554	-	( 6.397	-	max(0, 18.602	-	12.523	+	6.397	))
=	79.768

Munshaat Real Estate Projects Co KSCC's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Mar. 2024 is calculated as:

	ROIC % (Q: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2023 )	+	Invested Capital (Q: Mar. 2024 ))	/ count )
=	6.096 * ( 1 - 2.89% )	/	( (79.768	+	80.251)	/ 2 )
=	5.9198256	/	80.0095
=	7.40 %

where

	Invested Capital		(Q: Dec. 2023 )
=	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	))
=	86.243	-	12.554	-	( 6.397	-	max(0, 18.602	-	12.523	+	6.397	))
=	79.768

	Invested Capital		(Q: Mar. 2024 )
=	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	))
=	88.534	-	12.931	-	( 9.008	-	max(0, 19.014	-	14.366	+	9.008	))
=	80.251

Note: The Operating Income data used here is four times the quarterly (Mar. 2024) data.

Munshaat Real Estate Projects Co KSCC (KUW:MUNSHAAT) 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, Munshaat Real Estate Projects Co KSCC's WACC % is 7.40%. Munshaat Real Estate Projects Co KSCC's ROIC % is 7.10% (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.

Munshaat Real Estate Projects Co KSCC ROIC % Related Terms

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Munshaat Real Estate Projects Co KSCC (KUW:MUNSHAAT) Business Description

Industry

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Address

Al-Shuhada Street, Al-Arraya Tower 2, Floor 43, Sharq, Kuwait City, KWT

Website

http://www.munshaat.com

Munshaat Real Estate Projects Co KSCC is a real estate company. The company's operations predominantly consist of owning, selling and purchasing real estates and lands as well as developing them inside and outside Kuwait, and also managing the properties of others. The company is organized into two business segments - Real Estate segment comprises purchase, sale, development, renting, hotel operations and managing of properties; and Investment segment is involved in managing a portfolio of investments. Its primary geographic markets are Kuwait and Gulf Cooperation Council countries.

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