Daisy Group (FRA:PWH1) ROC % : -4.41% (As of Sep. 2014)

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What is Daisy Group 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 %. Daisy Group's annualized return on capital (ROC %) for the quarter that ended in Sep. 2014 was -4.41%.

As of today (2024-06-07), Daisy Group's WACC % is 2.21%. Daisy Group's ROC % is -4.47% (calculated using TTM income statement data). Daisy Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Daisy Group ROC % Historical Data

The historical data trend for Daisy Group'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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Daisy Group ROC % Chart

Daisy Group Annual Data

Trend

Dec04

Dec05

Dec06

Dec07

Dec08

Mar10

Mar11

Mar12

Mar13

Mar14

ROC %

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-10.50

-2.86

-1.65

-3.16

-3.28

Daisy Group Semi-Annual Data
	Dec03	Jun04	Dec04	Jun05	Dec05	Jun06	Dec06	Jun07	Dec07	Jun08	Dec08	Sep10	Mar11	Sep11	Mar12	Sep12	Mar13	Sep13	Mar14	Sep14
ROC %	Get a 7-Day Free Trial															-3.27	-2.07	-4.59	-2.02	-4.41

Daisy Group ROC % Calculation

Daisy Group's annualized Return on Capital (ROC %) for the fiscal year that ended in Mar. 2014 is calculated as:

	ROC % (A: Mar. 2014 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Mar. 2013 )	+	Invested Capital (A: Mar. 2014 ))	/ count )
=	-21.455 * ( 1 - 35.87% )	/	( (416.733	+	421.848)	/ 2 )
=	-13.7590915	/	419.2905
=	-3.28 %

where

	Invested Capital		(A: Mar. 2013 )
=	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	))
=	489.245	-	69.827	-	( 45.188	-	max(0, 143.706	-	146.391	+	45.188	))
=	416.733

	Invested Capital		(A: Mar. 2014 )
=	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	))
=	513.796	-	81.061	-	( 52.443	-	max(0, 164.999	-	175.886	+	52.443	))
=	421.848

Daisy Group's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2014 is calculated as:

	ROC % (Q: Sep. 2014 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2014 )	+	Invested Capital (Q: Sep. 2014 ))	/ count )
=	-20.462 * ( 1 - 19.02% )	/	( (421.848	+	329.469)	/ 2 )
=	-16.5701276	/	375.6585
=	-4.41 %

where

	Invested Capital		(Q: Mar. 2014 )
=	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	))
=	513.796	-	81.061	-	( 52.443	-	max(0, 164.999	-	175.886	+	52.443	))
=	421.848

	Invested Capital		(Q: Sep. 2014 )
=	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	))
=	507.242	-	149.341	-	( 46.564	-	max(0, 150.049	-	178.481	+	46.564	))
=	329.469

Note: The Operating Income data used here is two times the semi-annual (Sep. 2014) data.

Daisy Group (FRA:PWH1) 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, Daisy Group's WACC % is 2.21%. Daisy Group's ROC % is -4.47% (calculated using TTM income statement data). Daisy Group 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.

Daisy Group ROC % Related Terms

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Daisy Group (FRA:PWH1) Business Description

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GURUFOCUS.COM » STOCK LIST » Communication Services » Telecommunication Services » Daisy Group PLC (FRA:PWH1) » Definitions » ROC %

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Address

Website

http://www.daisygroupplc.com

Daisy Group PLC and its subsidiaries provide telecommunication and managed services to UK SME and mid-market businesses. It provides a combined product set including access, hosting, voice, managed services and mobile telephony. The Group's segments comprise Daisy Retail, Daisy Wholesale, and central costs. The Daisy Retail segment engages in the provision of integrated voice and data services to the small medium business market, The Daisy Wholesale segment supplies partners with billing, provisioning and business software solutions in addition to voice, lines and data services. Daisy Distribution provides a full range of mobile handsets and airtime tariffs from O2, Vodafone, Orange and T-Mobile via a dealer network and the Central segment consists of unallocated central activities.

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