Chagala Group (LSE:CHGG) ROIC % : -0.22% (As of Jun. 2018)

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What is Chagala Group 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 %. Chagala Group's annualized return on invested capital (ROIC %) for the quarter that ended in Jun. 2018 was -0.22%.

As of today (2024-05-28), Chagala Group's WACC % is 0.00%. Chagala Group's ROIC % is 16.53% (calculated using TTM income statement data). Chagala Group generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.

Chagala Group ROIC % Historical Data

The historical data trend for Chagala Group'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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Chagala Group ROIC % Chart

Chagala Group Annual Data

Trend

Dec08

Dec09

Dec10

Dec11

Dec12

Dec13

Dec14

Dec15

Dec16

Dec17

ROIC %

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1.33

2.40

2.55

2.32

2.77

Chagala Group Semi-Annual Data
	Jun09	Dec09	Jun10	Dec10	Jun11	Dec11	Jun12	Dec12	Jun13	Dec13	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18
ROIC %	Get a 7-Day Free Trial													4.36	-23.34	3.80	4.92	-0.22

Competitive Comparison of Chagala Group's ROIC %

For the Real Estate - Development subindustry, Chagala Group'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.

Chagala Group's ROIC % Distribution in the Real Estate Industry

For the Real Estate industry and Real Estate sector, Chagala Group's ROIC % distribution charts can be found below:

* The bar in red indicates where Chagala Group's ROIC % falls into.

Chagala Group ROIC % Calculation

Chagala Group's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2017 is calculated as:

	ROIC % (A: Dec. 2017 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2016 )	+	Invested Capital (A: Dec. 2017 ))	/ count )
=	3.555 * ( 1 - 33.41% )	/	( (87.273	+	83.903)	/ 2 )
=	2.3672745	/	85.588
=	2.77 %

where

	Invested Capital		(A: Dec. 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	))
=	92.074	-	2.588	-	( 2.213	-	max(0, 5.81	-	8.499	+	2.213	))
=	87.273

	Invested Capital		(A: Dec. 2017 )
=	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	))
=	87.701	-	2.741	-	( 1.781	-	max(0, 6.289	-	7.346	+	1.781	))
=	83.903

Chagala Group's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Jun. 2018 is calculated as:

	ROIC % (Q: Jun. 2018 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2017 )	+	Invested Capital (Q: Jun. 2018 ))	/ count )
=	2.9 * ( 1 - 106.35% )	/	( (83.903	+	80.267)	/ 2 )
=	-0.18415	/	82.085
=	-0.22 %

where

	Invested Capital		(Q: Dec. 2017 )
=	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	))
=	87.701	-	2.741	-	( 1.781	-	max(0, 6.289	-	7.346	+	1.781	))
=	83.903

	Invested Capital		(Q: Jun. 2018 )
=	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	))
=	84.14	-	2.38	-	( 1.51	-	max(0, 5.11	-	6.603	+	1.51	))
=	80.267

Note: The Operating Income data used here is two times the semi-annual (Jun. 2018) data.

Chagala Group (LSE:CHGG) 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, Chagala Group's WACC % is 0.00%. Chagala Group's ROIC % is 16.53% (calculated using TTM income statement data). Chagala Group generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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. Chagala Group 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 %, 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.

Chagala Group ROIC % Related Terms

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Chagala Group (LSE:CHGG) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » Real Estate » Chagala Group Ltd (LSE:CHGG) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

44 Wyndham Street Central, Wyndham Place, 26th Floor, Hong Kong, HKG

Website

http://www.chagalagroup.com

Chagala Group Ltd is a service and facility provider to the oil and gas industry. Business activity of the group is functioned through Room and Rent Operations, and Food and Beverages Operations segments. The company provides residential and business accommodation, associated catering, leisure, transport, warehousing, and logistics support to companies involved in extracting oil and gas from Kazakhstan's Caspian region. Chagala derives most of the revenue from Room and Rent Operations segment and rest from the other.