Lancaster resources (FRA:6UF0) ROC % : -24.55% (As of Sep. 2024)

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What is Lancaster resources 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 %. Lancaster resources's annualized return on capital (ROC %) for the quarter that ended in Sep. 2024 was -24.55%.

As of today (2024-12-14), Lancaster resources's WACC % is 5.78%. Lancaster resources's ROC % is -110.64% (calculated using TTM income statement data). Lancaster resources earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Lancaster resources ROC % Historical Data

The historical data trend for Lancaster resources'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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Lancaster resources ROC % Chart

Lancaster resources Annual Data

Trend

Nov19

Nov20

Nov21

Nov22

Mar23

Mar24

ROC %

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-1,418.56

-9,344.83

-3,112.20

-211.74

-191.12

Lancaster resources Quarterly Data
	Nov19	Feb20	May20	Aug20	Nov20	Feb21	May21	Aug21	Nov21	Feb22	May22	Aug22	Nov22	Feb23	May23	Sep23	Dec23	Mar24	Jun24	Sep24
ROC %	Get a 7-Day Free Trial															-317.04	-395.52	-184.24	-75.85	-24.55

Lancaster resources ROC % Calculation

Lancaster resources's annualized Return on Capital (ROC %) for the fiscal year that ended in Mar. 2024 is calculated as:

	ROC % (A: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Mar. 2023 )	+	Invested Capital (A: Mar. 2024 ))	/ count )
=	-1.292 * ( 1 - 0% )	/	( (0.298	+	1.054)	/ 2 )
=	-1.292	/	0.676
=	-191.12 %

where

	Invested Capital		(A: Mar. 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	))
=	0.793	-	0.074	-	( 0.421	-	max(0, 0.074	-	0.625	+	0.421	))
=	0.298

	Invested Capital		(A: Mar. 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	))
=	0.489	-	0.15	-	( 0.092	-	max(0, 0.905	-	0.19	+	0.092	))
=	1.054

Lancaster resources'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 )
=	-0.268 * ( 1 - 0% )	/	( (1.087	+	1.096)	/ 2 )
=	-0.268	/	1.0915
=	-24.55 %

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	))
=	0.429	-	0.183	-	( 0.099	-	max(0, 0.969	-	0.128	+	0.099	))
=	1.087

	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	))
=	0.356	-	0.227	-	( 0.032	-	max(0, 1.028	-	0.061	+	0.032	))
=	1.096

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

Lancaster resources (FRA:6UF0) 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, Lancaster resources's WACC % is 5.78%. Lancaster resources's ROC % is -110.64% (calculated using TTM income statement data). Lancaster resources 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.

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Lancaster resources Business Description

Industry

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LANRF:USA 6UF0:Germany LCR:Canada

Address

2569 Marine Drive, Vancouver, BC, CAN, V7V 1L5

Website

https://www.lancaster-resources.com

Lancaster resources Inc is engaged in exploring energy transition metals, particularly lithium, to take advantage of the shifts toward decarbonization and electrification. Its goal is to identify, acquire, explore, and develop high-quality mineral-rich properties, integrating sustainable energy sources and technologies for climate-positive resource production. The company holds exclusive rights to acquire a 100% interest in the Alkali Flat lithium brine project situated in Lordsburg, New Mexico, USA.

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