Emma Villas SpA (FRA:B1K) ROC % : -34.46% (As of Jun. 2024)

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What is Emma Villas SpA 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 %. Emma Villas SpA's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was -34.46%.

As of today (2024-12-14), Emma Villas SpA's WACC % is 8.43%. Emma Villas SpA's ROC % is 5.94% (calculated using TTM income statement data). Emma Villas SpA earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Emma Villas SpA ROC % Historical Data

The historical data trend for Emma Villas SpA'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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Emma Villas SpA ROC % Chart

Emma Villas SpA Annual Data

Trend

Dec21

Dec22

Dec23

ROC %

1.54

0.54

5.94

Emma Villas SpA Semi-Annual Data
	Dec21	Dec22	Jun23	Dec23	Jun24
ROC %	-	-	-30.50	50.44	-34.46

Emma Villas SpA ROC % Calculation

Emma Villas SpA'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 )
=	1.126 * ( 1 - 28.93% )	/	( (14.85	+	12.117)	/ 2 )
=	0.8002482	/	13.4835
=	5.94 %

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	))
=	17.951	-	3.417	-	( 5.303	-	max(0, 7.373	-	7.057	+	5.303	))
=	14.85

	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	))
=	17.227	-	2.867	-	( 5.763	-	max(0, 7.694	-	9.937	+	5.763	))
=	12.117

Emma Villas SpA'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 )
=	-9.386 * ( 1 - 23.68% )	/	( (12.117	+	29.46)	/ 2 )
=	-7.1633952	/	20.7885
=	-34.46 %

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	))
=	17.227	-	2.867	-	( 5.763	-	max(0, 7.694	-	9.937	+	5.763	))
=	12.117

	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	))
=	31.727	-	3.538	-	( 17.805	-	max(0, 25.412	-	24.141	+	17.805	))
=	29.46

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

Emma Villas SpA (FRA:B1K) 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, Emma Villas SpA's WACC % is 8.43%. Emma Villas SpA's ROC % is 5.94% (calculated using TTM income statement data). Emma Villas SpA 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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Emma Villas SpA Business Description

Industry

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Traded in Other Exchanges

EAV:Italy

Address

Zona P.A.I.P. - Localita Le Biffe, Chiusi Scalo, ITA, 53043

Website

https://www.emmavillas.com

Emma Villas SpA is the Italian leader in the vacation rental market (short-term rentals) of prestigious villas, country houses and residences. With about 500 exclusive properties, It is the first instant buyer and property manager if villas in italy.

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