Golden Agri-Resources (Golden Agri-Resources) ROC % : 1.19% (As of Dec. 2023)

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What is Golden Agri-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 %. Golden Agri-Resources's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was 1.19%.

As of today (2024-06-20), Golden Agri-Resources's WACC % is 3.56%. Golden Agri-Resources's ROC % is 3.35% (calculated using TTM income statement data). Golden Agri-Resources earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Golden Agri-Resources ROC % Historical Data

The historical data trend for Golden Agri-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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Golden Agri-Resources ROC % Chart

Golden Agri-Resources Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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1.39

1.47

6.58

12.46

3.37

Golden Agri-Resources Semi-Annual Data
	Jun14	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
ROC %	Get a 7-Day Free Trial															7.70	9.31	14.97	4.46	1.19

Golden Agri-Resources ROC % Calculation

Golden Agri-Resources'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 )
=	473.636 * ( 1 - 43.94% )	/	( (7949.174	+	7805.889)	/ 2 )
=	265.5203416	/	7877.5315
=	3.37 %

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	))
=	9902.072	-	988.289	-	( 1145.113	-	max(0, 3193.889	-	4158.498	+	1145.113	))
=	7949.174

	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	))
=	9716.488	-	775.376	-	( 1135.223	-	max(0, 2757.953	-	3916.771	+	1135.223	))
=	7805.889

Golden Agri-Resources's annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	546.496 * ( 1 - 82.84% )	/	( (7997.55	+	7805.889)	/ 2 )
=	93.7787136	/	7901.7195
=	1.19 %

where

	Invested Capital		(Q: Jun. 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	))
=	9851.805	-	653.58	-	( 1200.675	-	max(0, 2692.718	-	4086.844	+	1200.675	))
=	7997.55

	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	))
=	9716.488	-	775.376	-	( 1135.223	-	max(0, 2757.953	-	3916.771	+	1135.223	))
=	7805.889

Note: The Operating Income data used here is two times the semi-annual (Dec. 2023) data.

Golden Agri-Resources (OTCPK:GARPF) 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, Golden Agri-Resources's WACC % is 3.56%. Golden Agri-Resources's ROC % is 3.35% (calculated using TTM income statement data). Golden Agri-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.

Golden Agri-Resources ROC % Related Terms

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Golden Agri-Resources (Golden Agri-Resources) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Consumer Packaged Goods » Golden Agri-Resources Ltd (OTCPK:GARPF) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

GARPY:USA E5H:Singapore 4G3A:Germany

Address

C/o IQ EQ Corporate Services (Mauritius) Ltd, 33 Edith Cavell Street, Port Louis, MUS, 11324

Website

https://www.goldenagri.com.sg

Golden Agri-Resources Ltd is an integrated palm oil plantation company. It operates through two segments: Plantations and palm oil mills, and Palm, laurics, and others. The plantation and palm oil mills segment comprises the products from the upstream business. The Palm, laurics and others comprise the processing and merchandising of palm and oilseed-based products i.e. bulk, branded, oleo-chemicals and other vegetable oils. The majority of the revenue is generated from the Palm, laurics and other segments. The company generates the majority of its revenue from the Rest of Asia.