Peoplein (ASX:PPE) ROC % : 3.77% (As of Dec. 2023)

View and export this data going back to 2017. Start your Free Trial

What is Peoplein ROC %?

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Peoplein's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was 3.77%.

As of today (2024-04-29), Peoplein's WACC % is 7.25%. Peoplein's ROC % is 4.85% (calculated using TTM income statement data). Peoplein earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Peoplein ROC % Historical Data

The historical data trend for Peoplein's ROC % 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.

* Premium members only.

Peoplein ROC % Chart

Peoplein Annual Data

Trend

Jun18

Jun19

Jun20

Jun21

Jun22

Jun23

ROC %

Get a 7-Day Free Trial

11.69

6.50

7.10

7.67

7.87

Peoplein Semi-Annual Data
	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
ROC %	Get a 7-Day Free Trial								5.02	10.98	9.42	5.53	3.77

Peoplein ROC % Calculation

Peoplein's annualized Return on Capital (ROC %) for the fiscal year that ended in Jun. 2023 is calculated as:

	ROC % (A: Jun. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Jun. 2022 )	+	Invested Capital (A: Jun. 2023 ))	/ count )
=	34.443 * ( 1 - 32.17% )	/	( (287.362	+	306.335)	/ 2 )
=	23.3626869	/	296.8485
=	7.87 %

where

	Invested Capital		(A: Jun. 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	))
=	364.796	-	50.951	-	( 26.977	-	max(0, 120.214	-	146.697	+	26.977	))
=	287.362

	Invested Capital		(A: 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	))
=	396.868	-	66.586	-	( 39.868	-	max(0, 139.73	-	163.677	+	39.868	))
=	306.335

Peoplein's annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	9.882 * ( 1 - -21.27% )	/	( (306.335	+	328.793)	/ 2 )
=	11.9839014	/	317.564
=	3.77 %

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	))
=	396.868	-	66.586	-	( 39.868	-	max(0, 139.73	-	163.677	+	39.868	))
=	306.335

	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	))
=	405.684	-	65.707	-	( 26.367	-	max(0, 164.643	-	175.827	+	26.367	))
=	328.793

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

Peoplein (ASX:PPE) ROC % Explanation

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. 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 ROC % 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, Peoplein's WACC % is 7.25%. Peoplein's ROC % is 4.85% (calculated using TTM income statement data). Peoplein 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 %, ROC % 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.

Peoplein ROC % Related Terms

Thank you for viewing the detailed overview of Peoplein's ROC % provided by GuruFocus.com. Please click on the following links to see related term pages.

Peoplein (ASX:PPE) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Business Services » Peoplein Ltd (ASX:PPE) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

540 Wickham Street, Level 6, Fortitude Valley, QLD, AUS, 4006

Website

https://www.peoplein.com.au

Peoplein Ltd is a workforce management company. It delivers solutions to the workforce challenges faced by businesses in Australia. It provides recruiting, on-boarding, contracting, rostering, timesheet management, payroll, and workplace health and safety management. It also operates in disability care, childcare, infrastructure, mining, agriculture, and hospitality. It also operates under Health and Community Care, Information Technology and General Staffing, and Specialist Services. The Group segments the business into three verticals, Industrial and Specialist Services, Professional Services and Health and Community. The Group generates the majority of its revenue from Industrial and Specialist Services.

Peoplein (ASX:PPE) Headlines

No Headlines