Ceres Global Ag (TSX:CRP) ROC % : 11.36% (As of Dec. 2023)

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What is Ceres Global Ag 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 %. Ceres Global Ag's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was 11.36%.

As of today (2024-05-16), Ceres Global Ag's WACC % is 8.70%. Ceres Global Ag's ROC % is 5.08% (calculated using TTM income statement data). Ceres Global Ag earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Ceres Global Ag ROC % Historical Data

The historical data trend for Ceres Global Ag'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.

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Ceres Global Ag ROC % Chart

Ceres Global Ag Annual Data

Trend

Mar14

Mar15

Mar16

Jun17

Jun18

Jun19

Jun20

Jun21

Jun22

Jun23

ROC %

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-1.52

4.56

15.21

33.21

-1.12

Ceres Global Ag Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
ROC %	Get a 7-Day Free Trial															1.94	0.87	-2.06	10.73	11.36

Ceres Global Ag ROC % Calculation

Ceres Global Ag'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 )
=	-3.933 * ( 1 - 11.63% )	/	( (336.431	+	281.749)	/ 2 )
=	-3.4755921	/	309.09
=	-1.12 %

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	))
=	427.587	-	68.113	-	( 23.043	-	max(0, 173.316	-	242.531	+	23.043	))
=	336.431

	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	))
=	350.259	-	59.446	-	( 9.064	-	max(0, 103.145	-	162.84	+	9.064	))
=	281.749

Ceres Global Ag'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: Sep. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	19.592 * ( 1 - -108.43% )	/	( (392.925	+	326.127)	/ 2 )
=	40.8356056	/	359.526
=	11.36 %

where

	Invested Capital		(Q: Sep. 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	))
=	513.791	-	114.433	-	( 6.433	-	max(0, 255.44	-	327.158	+	6.433	))
=	392.925

	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	))
=	423.832	-	91.378	-	( 6.327	-	max(0, 165.516	-	238.522	+	6.327	))
=	326.127

Note: The Operating Income data used here is four times the quarterly (Dec. 2023) data.

Ceres Global Ag (TSX:CRP) 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, Ceres Global Ag's WACC % is 8.70%. Ceres Global Ag's ROC % is 5.08% (calculated using TTM income statement data). Ceres Global Ag 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.

Ceres Global Ag ROC % Related Terms

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Ceres Global Ag (TSX:CRP) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Retail - Defensive » Ceres Global Ag Corp (TSX:CRP) » Definitions » ROC %

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CERGF:USA

Address

701 Xenia Avenue S., Suite 400, Golden Valley, MN, USA, 55416

Website

https://www.ceresglobalagcorp.com

Ceres Global Ag Corp is engaged in the agricultural, energy, and industrial supply chains through sourcing, storing, transporting, and marketing of commodity-based products and raw materials. It has three operating segments. The Grain segment, which is the key revenue driver, is engaged in grain procurement and merchandising of specialty grains and oilseeds such as oats, barley, rye, hard red spring wheat, durum wheat, canola, and pulses. The Supply Chain Services segment utilizes the corporation's facilities to provide logistics services, storage, and transloading for commodities and industrial products. The Seed and Processing segment is engaged in soybean crush, specialty crops blending, birdfeed production, and seed distribution in Western Canada.

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