Powerlong Real Estate Holdings (HKSE:01238) ROC % : 3.00% (As of Jun. 2024)

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What is Powerlong Real Estate Holdings 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 %. Powerlong Real Estate Holdings's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was 3.00%.

As of today (2025-04-04), Powerlong Real Estate Holdings's WACC % is 1.54%. Powerlong Real Estate Holdings's ROC % is 0.40% (calculated using TTM income statement data). Powerlong Real Estate Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Powerlong Real Estate Holdings ROC % Historical Data

The historical data trend for Powerlong Real Estate Holdings'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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Powerlong Real Estate Holdings ROC % Chart

Powerlong Real Estate Holdings Annual Data

Trend

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Dec24

ROC %

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6.03

3.84

1.59

0.27

0.39

Powerlong Real Estate Holdings Semi-Annual Data
	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23	Jun24	Dec24
ROC %	Get a 7-Day Free Trial															0.95	0.81	-2.52	3.00	-0.76

Powerlong Real Estate Holdings ROC % Calculation

Powerlong Real Estate Holdings'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 )
=	372.67 * ( 1 - -31.47% )	/	( (185131.095	+	176439.247)	/ 2 )
=	489.949249	/	180785.171
=	0.27 %

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	))
=	261032.822	-	65037.696	-	( 10864.031	-	max(0, 130858.233	-	149608.769	+	10864.031	))
=	185131.095

	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	))
=	234950.069	-	62342.543	-	( 8588.591	-	max(0, 131233.12	-	127401.399	+	8588.591	))
=	176439.247

Powerlong Real Estate Holdings'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 )
=	2403.448 * ( 1 - -113.4% )	/	( (176439.247	+	165822.791)	/ 2 )
=	5128.958032	/	171131.019
=	3.00 %

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	))
=	234950.069	-	62342.543	-	( 8588.591	-	max(0, 131233.12	-	127401.399	+	8588.591	))
=	176439.247

	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	))
=	222201.055	-	65311.266	-	( 7043.639	-	max(0, 123420.163	-	114487.161	+	7043.639	))
=	165822.791

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

Powerlong Real Estate Holdings (HKSE:01238) 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, Powerlong Real Estate Holdings's WACC % is 1.54%. Powerlong Real Estate Holdings's ROC % is 0.40% (calculated using TTM income statement data). Powerlong Real Estate Holdings 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.

Powerlong Real Estate Holdings ROC % Related Terms

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Powerlong Real Estate Holdings Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » Real Estate » Powerlong Real Estate Holdings Ltd (HKSE:01238) » Definitions » ROC %

Traded in Other Exchanges

PW5:Germany

Address

1399 Xinzhen Road, Powerlong Tower, Baolong Building, Minhang District, Shanghai, CHN, 201101

Website

https://www.powerlong.com

Powerlong Real Estate Holdings Ltd specializes in commercial realty projects. The company operates in four business segments: property development; property investment; commercial operation and residential property management; and other property development related businesses. Majority of the company's revenue is earned from property development segment.

Executives

Hoi Wa Fong
Shih Sze Ni Cecilia
Hoi Kin Hong
Skylong Holdings Limited	2101 Beneficial owner
Tmf (cayman) Ltd.	2301 Trustee
Skylong Family Limited	2201 Interest of corporation controlled by you
Wason Holdings Limited	2101 Beneficial owner
Sky Infinity Family Limited	2201 Interest of corporation controlled by you
Hoi Wa Fan	2201 Interest of corporation controlled by you
Walong Holdings Limited	2101 Beneficial owner
Credit Suisse Trust Limited	2101 Beneficial owner
Sky Infinity Holdings Limited	2101 Beneficial owner

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