Tian Lun Gas Holdings (HKSE:01600) ROC % : 3.80% (As of Jun. 2024)

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What is Tian Lun Gas 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 %. Tian Lun Gas Holdings's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was 3.80%.

As of today (2024-12-12), Tian Lun Gas Holdings's WACC % is 5.49%. Tian Lun Gas Holdings's ROC % is 5.26% (calculated using TTM income statement data). Tian Lun Gas Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Tian Lun Gas Holdings ROC % Historical Data

The historical data trend for Tian Lun Gas 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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Tian Lun Gas Holdings ROC % Chart

Tian Lun Gas Holdings Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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10.54

11.25

9.73

5.67

5.80

Tian Lun Gas Holdings Semi-Annual Data
	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23	Jun24
ROC %	Get a 7-Day Free Trial															4.96	6.61	5.02	6.64	3.80

Tian Lun Gas Holdings ROC % Calculation

Tian Lun Gas 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 )
=	1256.38 * ( 1 - 29.29% )	/	( (15057.758	+	15593.227)	/ 2 )
=	888.386298	/	15325.4925
=	5.80 %

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	))
=	17821.353	-	1761.261	-	( 1508.72	-	max(0, 5677.956	-	6680.29	+	1508.72	))
=	15057.758

	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	))
=	17161.964	-	1523.728	-	( 1070.414	-	max(0, 6238.44	-	6283.449	+	1070.414	))
=	15593.227

Tian Lun Gas 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 )
=	859.284 * ( 1 - 32.07% )	/	( (15593.227	+	15106.53)	/ 2 )
=	583.7116212	/	15349.8785
=	3.80 %

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	))
=	17161.964	-	1523.728	-	( 1070.414	-	max(0, 6238.44	-	6283.449	+	1070.414	))
=	15593.227

	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	))
=	17337.404	-	1204.194	-	( 1394.313	-	max(0, 5615.068	-	6641.748	+	1394.313	))
=	15106.53

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

Tian Lun Gas Holdings (HKSE:01600) 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, Tian Lun Gas Holdings's WACC % is 5.49%. Tian Lun Gas Holdings's ROC % is 5.26% (calculated using TTM income statement data). Tian Lun Gas 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.

Tian Lun Gas Holdings ROC % Related Terms

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Tian Lun Gas Holdings Business Description

Industry

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TLJ:Germany

Address

No. 6 Huang He East Road, 4th Floor, Tian Lun Group Building, Zheng Dong Xin District, Henan Province, Zhengzhou City, CHN, 450003

Website

https://www.tianlungas.com

Tian Lun Gas Holdings Ltd is a Chinese investment holding company whose subsidiaries are engaged in the investment, operation and management of gas pipeline connections, transportation, distribution and sales of gas, construction and operation of gas filling stations, and production and sales of LNG in the People's Republic of China. The segments of the company are sale of natural gas in cylinders, sale of natural gas in bulk and engineering construction services. The company derives majority of its revenue from the sale of natural gas.

Executives

Zhang Yingcen	2201 Interest of corporation controlled by you
Zhang Daoyuan	2103 Interests held jointly with another person
Or Wai Sheun	2201 Interest of corporation controlled by you
Hantec Securities Company Limited	2302 Custodian
Gold Shine Development Limited
Tian Lun Group Limited
Zhuhai Port Co., Ltd.
Zhuhai Port (hong Kong) Development Co., Limited
Chequers Development Limited
Sun Yanxi
International Finance Corporation	2101 Beneficial owner
Ifc Asset Management Company, Llc	2102 Investment manager
Koo Yuen Kim	2101 Beneficial owner

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