Civeo (FRA:44C1) ROC % : 0.78% (As of Sep. 2024)

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What is Civeo 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 %. Civeo's annualized return on capital (ROC %) for the quarter that ended in Sep. 2024 was 0.78%.

As of today (2024-12-14), Civeo's WACC % is 7.42%. Civeo's ROC % is 1.64% (calculated using TTM income statement data). Civeo earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Civeo ROC % Historical Data

The historical data trend for Civeo'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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Civeo ROC % Chart

Civeo Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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-2.08

-0.33

0.95

2.49

3.31

Civeo Quarterly Data
	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24
ROC %	Get a 7-Day Free Trial															15.40	-0.01	-0.04	8.32	0.78

Civeo ROC % Calculation

Civeo's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	20.442 * ( 1 - 26.34% )	/	( (473.994	+	436.071)	/ 2 )
=	15.0575772	/	455.0325
=	3.31 %

where

	Invested Capital		(A: Dec. 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	))
=	534.478	-	52.975	-	( 7.509	-	max(0, 121.075	-	144.95	+	7.509	))
=	473.994

	Invested Capital		(A: 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	))
=	502.573	-	63.455	-	( 3.047	-	max(0, 104.754	-	160.701	+	3.047	))
=	436.071

Civeo's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2024 is calculated as:

	ROC % (Q: Sep. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2024 )	+	Invested Capital (Q: Sep. 2024 ))	/ count )
=	0.776 * ( 1 - -270.61% )	/	( (383.472	+	352.497)	/ 2 )
=	2.8759336	/	367.9845
=	0.78 %

where

	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	))
=	448.924	-	58.545	-	( 6.907	-	max(0, 91.121	-	140.83	+	6.907	))
=	383.472

	Invested Capital		(Q: Sep. 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	))
=	430.35	-	61.716	-	( 16.137	-	max(0, 96.262	-	131.101	+	16.137	))
=	352.497

Note: The Operating Income data used here is four times the quarterly (Sep. 2024) data.

Civeo (FRA:44C1) 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, Civeo's WACC % is 7.42%. Civeo's ROC % is 1.64% (calculated using TTM income statement data). Civeo 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.

Civeo ROC % Related Terms

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Civeo Business Description

Industry

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CVEO:USA

Address

333 Clay Street, Three Allen Center, Suite 4980, Houston, TX, USA, 77002

Website

https://www.civeo.com

Civeo Corp provides hospitality services to the natural resources industry in Canada, Australia and the United States. The company provides a full suite of services for guests, including lodging, catering and food service, housekeeping and maintenance at accommodation facilities that the company or its customers own. The company provides services that support the day-to-day operations of these facilities, such as laundry, facility management and maintenance, water and wastewater treatments, power generation, communication systems, security and logistics. The company operates in active oil, metallurgical coal, liquefied natural gas and iron ore-producing regions. The company operates in three reportable business segments Canada, Australia and the United States.

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