BDMMF (Burgundy Diamond Mines) ROC % : 14.52% (As of Jun. 2024)

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What is Burgundy Diamond 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 %. Burgundy Diamond Mines's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was 14.52%.

As of today (2024-12-13), Burgundy Diamond Mines's WACC % is 13.91%. Burgundy Diamond Mines's ROC % is 4.86% (calculated using TTM income statement data). Burgundy Diamond Mines earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Burgundy Diamond Mines ROC % Historical Data

The historical data trend for Burgundy Diamond 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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Burgundy Diamond Mines ROC % Chart

Burgundy Diamond Mines Annual Data

Trend

Jun13

Jun14

Jun15

Jun16

Jun17

Jun18

Jun19

Jun20

Jun21

Jun22

ROC %

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-179,600.00

-235.63

Burgundy Diamond 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															-92.90	-90.69	-28.76	-0.42	14.52

Burgundy Diamond Mines ROC % Calculation

Burgundy Diamond Mines's annualized Return on Capital (ROC %) for the fiscal year that ended in Jun. 2022 is calculated as:

	ROC % (A: Jun. 2022 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Jun. 2021 )	+	Invested Capital (A: Jun. 2022 ))	/ count )
=	-11.076 * ( 1 - 0% )	/	( (0.0049999999999999	+	9.396)	/ 2 )
=	-11.076	/	4.7005
=	-235.63 %

where

	Invested Capital		(A: Jun. 2021 )
=	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	))
=	1.335	-	0.264	-	( 1.273	-	max(0, 0.264	-	1.33	+	1.273	))
=	0.0049999999999999

	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	))
=	25.35	-	1.159	-	( 14.795	-	max(0, 1.373	-	22.513	+	14.795	))
=	9.396

Burgundy Diamond Mines's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2024 is calculated as:

	ROC % (Q: Jun. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2023 )	+	Invested Capital (Q: Jun. 2024 ))	/ count )
=	44.794 * ( 1 - -68.36% )	/	( (518.542	+	520.194)	/ 2 )
=	75.4151784	/	519.368
=	14.52 %

where

	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	))
=	666.985	-	54.017	-	( 94.426	-	max(0, 123.1	-	353.526	+	94.426	))
=	518.542

	Invested Capital		(Q: Jun. 2024 )
=	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	))
=	619.641	-	42.501	-	( 56.946	-	max(0, 90.759	-	313.029	+	56.946	))
=	520.194

Note: The Operating Income data used here is two times the semi-annual (Jun. 2024) data.

Burgundy Diamond Mines (OTCPK:BDMMF) 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, Burgundy Diamond Mines's WACC % is 13.91%. Burgundy Diamond Mines's ROC % is 4.86% (calculated using TTM income statement data). Burgundy Diamond 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.

Burgundy Diamond Mines ROC % Related Terms

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Burgundy Diamond Mines Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Metals & Mining » Burgundy Diamond Mines Ltd (OTCPK:BDMMF) » Definitions » ROC %

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BDM:Australia

Address

108 Street Georges Terrace, Level 25 , South 32 Tower, Perth, WA, AUS, 6000

Website

https://www.burgundy-diamonds.com

Burgundy Diamond Mines Ltd is an Australian diamond exploration company. The company holds interests in the Naujaat property, Ekati mine, and other operations. The Group's reportable segments comprise Rough Diamond and Polished Diamond. The company generates maximum revenue from Rough Diamonds.