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Chilwa Minerals (ASX:CHW) ROC % : -32.80% (As of Dec. 2023)


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What is Chilwa Minerals 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 %. Chilwa Minerals's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was -32.80%.

As of today (2025-03-17), Chilwa Minerals's WACC % is 10.49%. Chilwa Minerals's ROC % is -29.11% (calculated using TTM income statement data). Chilwa Minerals earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Chilwa Minerals ROC % Historical Data

The historical data trend for Chilwa Minerals'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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Chilwa Minerals ROC % Chart

Chilwa Minerals Annual Data
Trend Jun23 Jun24
ROC %
-13.31 -26.25

Chilwa Minerals Semi-Annual Data
Dec22 Jun23 Dec23 Jun24
ROC % -26.83 -17.81 -32.80 -28.69

Chilwa Minerals ROC % Calculation

Chilwa Minerals'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: . 20 ) + Invested Capital (A: Jun. 2023 ))/ count )
= * ( 1 - % )/( ( + )/ )
=/
= %

where

Chilwa Minerals'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 )
=-2.118 * ( 1 - 0% )/( (7.688 + 5.226)/ 2 )
=-2.118/6.457
=-32.80 %

where

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


Chilwa Minerals  (ASX:CHW) 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, Chilwa Minerals's WACC % is 10.49%. Chilwa Minerals's ROC % is -29.11% (calculated using TTM income statement data). Chilwa Minerals 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.


Chilwa Minerals ROC % Related Terms

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Chilwa Minerals Business Description

Traded in Other Exchanges
N/A
Address
17 Ord Street, Level 1,Suite 3, West Perth, WA, AUS, 6005
Chilwa Minerals Ltd is formed for the purpose of exploring and developing portfolio of high-quality market sustaining HMS assets with a primary focus on the Lake Chilwa precinct in Malawi, Africa. The principal activities of the Company consisted of due diligence exploration and development activities at the mineral exploration project at Chilwa Heavy Mineral Sands Project (Project) in Malawi which is the subject of a Share Sale Agreement between the Company, Mota-Engil Investments. The Project is located around the northern, western and southern shores of Lake Chilwa in southern Malawi.

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