Theta Gold Mines (ASX:TGM) ROC % : -12.36% (As of Dec. 2023)

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What is Theta Gold Mines 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 %. Theta Gold Mines's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was -12.36%.

As of today (2024-12-14), Theta Gold Mines's WACC % is 17.12%. Theta Gold Mines's ROC % is -11.10% (calculated using TTM income statement data). Theta Gold Mines earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Theta Gold Mines ROC % Historical Data

The historical data trend for Theta Gold Mines'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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Theta Gold Mines ROC % Chart

Theta Gold Mines Annual Data

Trend

Jun15

Jun16

Jun17

Jun18

Jun19

Jun20

Jun21

Jun22

Jun23

Jun24

ROC %

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-25.05

-14.36

-18.54

-15.36

-10.93

Theta Gold Mines Semi-Annual Data
	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23	Jun24
ROC %	Get a 7-Day Free Trial															-17.62	-11.84	-18.94	-12.36	-10.00

Theta Gold Mines ROC % Calculation

Theta Gold Mines'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 )
=	-6.343 * ( 1 - 0% )	/	( (40.005	+	42.599)	/ 2 )
=	-6.343	/	41.302
=	-15.36 %

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	))
=	28.251	-	1.063	-	( 0.031	-	max(0, 13.06	-	0.243	+	0.031	))
=	40.005

	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	))
=	29.208	-	2.987	-	( 2.859	-	max(0, 20.005	-	3.627	+	2.859	))
=	42.599

Theta Gold Mines'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 )
=	-5.754 * ( 1 - 0% )	/	( (42.599	+	50.494)	/ 2 )
=	-5.754	/	46.5465
=	-12.36 %

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	))
=	29.208	-	2.987	-	( 2.859	-	max(0, 20.005	-	3.627	+	2.859	))
=	42.599

	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	))
=	30.874	-	1.412	-	( 1.088	-	max(0, 22.347	-	1.315	+	1.088	))
=	50.494

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

Theta Gold Mines (ASX:TGM) 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, Theta Gold Mines's WACC % is 17.12%. Theta Gold Mines's ROC % is -11.10% (calculated using TTM income statement data). Theta Gold Mines 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.

Theta Gold Mines ROC % Related Terms

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Theta Gold Mines Business Description

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TGMGF:USA 3LM:Germany

Address

100 Barangaroo Avenue, Suite 80, Level 35 (ServCorp), International Tower One, Sydney, NSW, AUS, 2000

Website

https://www.thetagoldmines.com

Theta Gold Mines Ltd is a gold exploration and development company. The company holds gold assets in the South African gold mining region. The projects of the company include the TGME Project near the historic gold mining town of Pilgrims Rest in Mpumalanga Province, and other projects.

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