Aerodrome Group (XTAE:ARDM) ROIC % : 1.79% (As of Dec. 2023)

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What is Aerodrome 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 %. Aerodrome Group's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2023 was 1.79%.

As of today (2024-05-08), Aerodrome Group's WACC % is 9.52%. Aerodrome Group's ROIC % is -1.27% (calculated using TTM income statement data). Aerodrome Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Aerodrome Group ROIC % Historical Data

The historical data trend for Aerodrome 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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Aerodrome Group ROIC % Chart

Aerodrome Group Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROIC %

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-156.96

-17.74

-24.68

-19.34

-1.18

Aerodrome Group Semi-Annual Data
	Jun14	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
ROIC %	Get a 7-Day Free Trial															-17.94	-12.81	-26.99	-6.64	1.79

Competitive Comparison of Aerodrome Group's ROIC %

For the Education & Training Services subindustry, Aerodrome 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.

Aerodrome Group's ROIC % Distribution in the Education Industry

For the Education industry and Consumer Defensive sector, Aerodrome Group's ROIC % distribution charts can be found below:

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

Aerodrome Group ROIC % Calculation

Aerodrome Group'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 )
=	-1.648 * ( 1 - 61.48% )	/	( (53.783	+	53.501)	/ 2 )
=	-0.6348096	/	53.642
=	-1.18 %

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	))
=	62.952	-	4.533	-	( 4.636	-	max(0, 10.859	-	23.194	+	4.636	))
=	53.783

	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	))
=	59.509	-	4.134	-	( 1.874	-	max(0, 9.705	-	21.246	+	1.874	))
=	53.501

Aerodrome Group's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROIC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	0.484 * ( 1 - -78.43% )	/	( (42.853	+	53.501)	/ 2 )
=	0.8636012	/	48.177
=	1.79 %

where

	Invested Capital		(Q: Jun. 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	))
=	59.66	-	6.533	-	( 10.274	-	max(0, 10.04	-	20.745	+	10.274	))
=	42.853

	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	))
=	59.509	-	4.134	-	( 1.874	-	max(0, 9.705	-	21.246	+	1.874	))
=	53.501

Note: The Operating Income data used here is two times the semi-annual (Dec. 2023) data.

Aerodrome Group (XTAE:ARDM) 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, Aerodrome Group's WACC % is 9.52%. Aerodrome Group's ROIC % is -1.27% (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.

Aerodrome Group ROIC % Related Terms

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Aerodrome Group (XTAE:ARDM) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Education » Aerodrome Group Ltd (XTAE:ARDM) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

10th Amal Street, Afek Industrial Park, Rosh Haayin, ISR, 94158

Website

https://www.aerodrome-ops.com

Aerodrome Group Ltd is a provider of UAS services and solutions. Its UAS operations include UAS Piloting, UAS External Pilot Training, UAS Pilot In Command (PIC) Training, UAS Payload Operator Training, Advanced Mission Training. The company provides four different courses running in parallel; PIC training, O-Level training, external pilot training, and payload operator training. It provides a full envelope of services for defense industries and organizations that wish to use unmanned systems.

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