Precinct Properties NZ & Precinct Properties Investments (Precinct Properties NZ & Precinct Properties Investments) ROC % : 3.06% (As of Dec. 2023)

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What is Precinct Properties NZ & Precinct Properties Investments 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 %. Precinct Properties NZ & Precinct Properties Investments's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was 3.06%.

As of today (2024-05-01), Precinct Properties NZ & Precinct Properties Investments's WACC % is 4.53%. Precinct Properties NZ & Precinct Properties Investments's ROC % is 1.77% (calculated using TTM income statement data). Precinct Properties NZ & Precinct Properties Investments earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Precinct Properties NZ & Precinct Properties Investments ROC % Historical Data

The historical data trend for Precinct Properties NZ & Precinct Properties Investments'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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Precinct Properties NZ & Precinct Properties Investments ROC % Chart

Precinct Properties NZ & Precinct Properties Investments Annual Data

Trend

Jun14

Jun15

Jun16

Jun17

Jun18

Jun19

Jun20

Jun21

Jun22

Jun23

ROC %

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1.78

1.83

-5.66

1.66

2.05

Precinct Properties NZ & Precinct Properties Investments Semi-Annual Data
	Jun14	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
ROC %	Get a 7-Day Free Trial															2.35	1.02	-2.14	1.10	3.06

Precinct Properties NZ & Precinct Properties Investments ROC % Calculation

Precinct Properties NZ & Precinct Properties Investments'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 )
=	51.35 * ( 1 - 7.04% )	/	( (2431.83	+	2222.209)	/ 2 )
=	47.73496	/	2327.0195
=	2.05 %

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	))
=	2439.136	-	0	-	( 7.306	-	max(0, 29.797	-	390.915	+	7.306	))
=	2431.83

	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	))
=	2234.847	-	2.454	-	( 10.184	-	max(0, 51.411	-	182.515	+	10.184	))
=	2222.209

Precinct Properties NZ & Precinct Properties Investments'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 )
=	78.034 * ( 1 - 13.56% )	/	( (2222.209	+	2189.048)	/ 2 )
=	67.4525896	/	2205.6285
=	3.06 %

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	))
=	2234.847	-	2.454	-	( 10.184	-	max(0, 51.411	-	182.515	+	10.184	))
=	2222.209

	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	))
=	2162.85	-	26.633	-	( 12.446	-	max(0, 93.777	-	40.946	+	12.446	))
=	2189.048

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

Precinct Properties NZ & Precinct Properties Investments (OTCPK:AOTUF) 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, Precinct Properties NZ & Precinct Properties Investments's WACC % is 4.53%. Precinct Properties NZ & Precinct Properties Investments's ROC % is 1.77% (calculated using TTM income statement data). Precinct Properties NZ & Precinct Properties Investments 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.

Precinct Properties NZ & Precinct Properties Investments ROC % Related Terms

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Precinct Properties NZ & Precinct Properties Investments (Precinct Properties NZ & Precinct Properties Investments) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » REITs » Precinct Properties NZ Ltd & Precinct Properties Investments Ltd (OTCPK:AOTUF) » Definitions » ROC %

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Traded in Other Exchanges

PCT:New Zealand

Address

188 Quay Street, Level 12, Auckland, NZL, 1010

Website

https://www.precinct.co.nz

Precinct Properties NZ Ltd & Precinct Properties Investments Ltd invests predominantly in prime office properties in the central business districts of New Zealand. The company's operating segment includes Investment properties, Hospitality, and Flexible space. It generates maximum revenue from the Investment properties segment. Some of its properties include ANZ Centre; 10 Madden Street; Mason Brothers; PwC Tower at Commercial Bay and others.