ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Evergreen Fibreboard Bhd's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2023 was -11.42%.
As of today (2024-05-20), Evergreen Fibreboard Bhd's WACC % is 10.39%. Evergreen Fibreboard Bhd's ROIC % is -3.18% (calculated using TTM income statement data).
Evergreen Fibreboard Bhd earns returns that do not match up to its cost of capital. It will destroy value as it grows.
* 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.
Competitive Comparison of Evergreen Fibreboard Bhd's ROIC %
For the Furnishings, Fixtures & Appliances subindustry, Evergreen Fibreboard Bhd'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.
Evergreen Fibreboard Bhd's ROIC % Distribution in the Furnishings, Fixtures & Appliances Industry
For the Furnishings, Fixtures & Appliances industry and Consumer Cyclical sector, Evergreen Fibreboard Bhd's ROIC % distribution charts can be found below:
* The bar in red indicates where Evergreen Fibreboard Bhd's ROIC % falls into.
Evergreen Fibreboard Bhd ROIC % Calculation
Evergreen Fibreboard Bhd's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2023 is calculated as:
Note:
The Operating Income data used here is four times the quarterly (Dec. 2023) data.
* 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.
Evergreen Fibreboard Bhd (XKLS:5101) 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, Evergreen Fibreboard Bhd's WACC % is 10.39%. Evergreen Fibreboard Bhd's ROIC % is -3.18% (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.
Evergreen Fibreboard Bhd ROIC % Related Terms
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Evergreen Fibreboard Bhd (XKLS:5101) Business Description
Evergreen Fibreboard Bhd is a Malaysia based company engaged in the manufacture of medium-density fibreboard and wooden furniture. The group is organised into three geographical segments; Malaysia which involves the manufacture of medium density fibreboard, wooden furniture parts and furniture, particleboard, glue, and resin, as well as trading and managing of plantation; Thailand which involves the production and distribution of medium density fibreboard and wood products; and Indonesia which comprises manufacture of medium density fibreboard, glue and resin; and Others which consists distribution of household products made of rubberwood. It derives prime revenue from Malaysia.
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