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ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Future FinTech Group's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2023 was -55.43%.
As of today (2024-04-26), Future FinTech Group's WACC % is 10.76%. Future FinTech Group's ROIC % is -21.64% (calculated using TTM income statement data). Future FinTech Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.
The historical data trend for Future FinTech 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.
Future FinTech Group Annual Data | |||||||||||||||||||||
Trend | Dec14 | Dec15 | Dec16 | Dec17 | Dec18 | Dec19 | Dec20 | Dec21 | Dec22 | Dec23 | |||||||||||
ROIC % | Get a 7-Day Free Trial | -5.76 | -12.00 | -57.47 | -31.71 | -23.86 |
Future FinTech Group Quarterly Data | ||||||||||||||||||||
Mar19 | Jun19 | Sep19 | Dec19 | Mar20 | Jun20 | Sep20 | Dec20 | Mar21 | Jun21 | Sep21 | Dec21 | Mar22 | Jun22 | Sep22 | Dec22 | Mar23 | Jun23 | Sep23 | Dec23 | |
ROIC % | Get a 7-Day Free Trial | -33.79 | -18.30 | -2.37 | -23.91 | -55.43 |
For the Software - Application subindustry, Future FinTech 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.
For the Software industry and Technology sector, Future FinTech Group's ROIC % distribution charts can be found below:
* The bar in red indicates where Future FinTech Group's ROIC % falls into.
Future FinTech 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 ) |
= | -10.261 * ( 1 - -0.01% ) | / | ( (52.011 | + | 34.003) | / 2 ) |
= | -10.2620261 | / | 43.007 | |||
= | -23.86 % |
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 | )) |
= | 85.018 | - | 5.948 | - | ( 27.059 | - | max(0, 18.571 | - | 65.258 | + | 27.059 | )) |
= | 52.011 |
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 | )) |
= | 60.941 | - | 6.947 | - | ( 19.991 | - | max(0, 17.728 | - | 54.49 | + | 19.991 | )) |
= | 34.003 |
Future FinTech 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: Sep. 2023 ) | + | Invested Capital (Q: Dec. 2023 )) | / count ) |
= | -18.84 * ( 1 - 0.25% ) | / | ( (33.801 | + | 34.003) | / 2 ) |
= | -18.7929 | / | 33.902 | |||
= | -55.43 % |
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 | )) |
= | 70.542 | - | 3.079 | - | ( 33.662 | - | max(0, 11.518 | - | 50.66 | + | 33.662 | )) |
= | 33.801 |
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 | )) |
= | 60.941 | - | 6.947 | - | ( 19.991 | - | max(0, 17.728 | - | 54.49 | + | 19.991 | )) |
= | 34.003 |
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.
Future FinTech Group (NAS:FTFT) 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, Future FinTech Group's WACC % is 10.76%. Future FinTech Group's ROIC % is -21.64% (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.
Thank you for viewing the detailed overview of Future FinTech Group's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Ming Yi | officer: Chief Financial Officer | PUDONG BUILDING, 2ND FLOOR, JUILING AVENUE, LONGWEN DISTRICT, ZHANGZHOU F4 363000 |
Yang Liu | officer: Chief Operating Officer | 59 FREDERICKS ST, WEST ORANGE NJ 07052 |
Mingjie Zhao | director | 190-19 50TH AVE, FRESH MEADOWS NY 11365 |
Shanchun Huang | director, officer: Chief Executive Officer | PUDONG BUILDING, 2ND FLOOR,, JIULONG AVENUE, LONGWEN DISTRICT, ZHANGZHOU F4 363000 |
Hanjun Zheng | officer: Interim CFO | 23F, CHINA DEVELOPMENT BANK TOWER, NO. 2, GAOXIN 1ST ROAD, XI'AN F4 710075 |
Zhi Yan | director | ROOM 03-1102, FL 11, BLDG C,SOHO,SALITUN, WORKERS' STADIUM NORTH RD,CHAOYANG DIST, BEIJING F4 0000000000 |
Yiliang Li | director | NO. 1803, BUILDING B, GUOHONG MANSION, MUXIDI, XICHENG DISTRICT, BEIJING F4 10038 |
Hongke Xue | director, officer: Chief Executive Officer | 16F, CHINA DEVELOPMENT BANK TOWER, NO 2 GAOXIN 1ST RD, XI'AN F4 710075 |
V.x. Fortune Capital Ltd | 10 percent owner | P.O. BOX 957, OFFSHORE INCORPORATIONS CENTRE, ROAD TOWN, TORTOLA D8 00000 |
Skypeople International Holdings Group Ltd | 10 percent owner | P.O. BOX 2804, 4TH FLOOR, SCOTIA CENTRE, GEORGE TOWN E9 KY1-1112 |
Golden Dawn International Ltd | 10 percent owner | P.O. BOX 957, OFFSHORE INCORPORATIONS CENTRE, ROAD TOWN, TORTOLA D8 00000 |
Baosheng Lu | director | ROOM 501, BLOCK 3, BINGJIAO LANE, TIANSHUIJING ROAD, XI'AN, SHAANXI PROVINCE F4 710002 |
Tao Wang | director | 32/F, CHINA MERCHANTS TOWER, 118 JIAN GUO ROAD, CHAO YANG DISTRICT, BEIJING F4 100022 |
Yong Ke Xue | director, officer: Chief Executive Officer | 16 F, NATIONAL DEVELOPMENT BANK TOWER, GAOXIN 2ND ROAD, XI'AN F4 710075 |
John W. Smagula | director | 3036 FANSHAWE ST, PHILADELPHIA PA 19149 |
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