Pureprofile (ASX:PPL) ROC % : 5.65% (As of Dec. 2023)

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What is Pureprofile 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 %. Pureprofile's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was 5.65%.

As of today (2024-05-04), Pureprofile's WACC % is 5.52%. Pureprofile's ROC % is -2.85% (calculated using TTM income statement data). Pureprofile earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Pureprofile ROC % Historical Data

The historical data trend for Pureprofile'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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Pureprofile ROC % Chart

Pureprofile Annual Data

Trend

Jun16

Jun17

Jun18

Jun19

Jun20

Jun21

Jun22

Jun23

ROC %

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-19.98

-10.91

-10.24

-19.99

-6.17

Pureprofile Semi-Annual Data
	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
ROC %	Get a 7-Day Free Trial												-9.55	-30.39	0.70	-10.81	5.65

Pureprofile ROC % Calculation

Pureprofile'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 )
=	-0.751 * ( 1 - -6.32% )	/	( (10.613	+	15.264)	/ 2 )
=	-0.7984632	/	12.9385
=	-6.17 %

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	))
=	21.03	-	8.869	-	( 5.298	-	max(0, 12.531	-	14.079	+	5.298	))
=	10.613

	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	))
=	22.527	-	8.672	-	( 4.726	-	max(0, 16.216	-	14.807	+	4.726	))
=	15.264

Pureprofile'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 )
=	0.81 * ( 1 - 4.55% )	/	( (15.264	+	12.099)	/ 2 )
=	0.773145	/	13.6815
=	5.65 %

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	))
=	22.527	-	8.672	-	( 4.726	-	max(0, 16.216	-	14.807	+	4.726	))
=	15.264

	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	))
=	24.25	-	9.978	-	( 4.738	-	max(0, 14.594	-	16.767	+	4.738	))
=	12.099

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

Pureprofile (ASX:PPL) 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, Pureprofile's WACC % is 5.52%. Pureprofile's ROC % is -2.85% (calculated using TTM income statement data). Pureprofile 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.

Pureprofile ROC % Related Terms

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Pureprofile (ASX:PPL) Business Description

Industry

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Address

263 Riley Street, Surry Hills, Sydney, NSW, AUS, 2010

Website

https://www.business.pureprofile.com

Pureprofile Ltd is a global data and insights organization providing online research and digital advertising services for agencies, marketers, researchers, and publishers. The research division delivers rich insights into real human behavior and provides the "Why" behind the "What" through ResTech and SaaS solutions. The digital advertising division taps into rich insights on behalf of advertisers and publishers and executes impactful targeted digital marketing strategies. Further, the company builds in-depth profiles of consumers through proprietary and partner panels and gives businesses the ability to understand, target, and ultimately engage with the audiences. Geographically, it operates in North America, Europe, and APAC and has delivered solutions for over 700 clients.