Hatcher Group (HKSE:08365) ROC % : -16.46% (As of Sep. 2023)

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What is Hatcher 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 %. Hatcher Group's annualized return on capital (ROC %) for the quarter that ended in Sep. 2023 was -16.46%.

As of today (2024-06-16), Hatcher Group's WACC % is 3.53%. Hatcher Group's ROC % is -27.20% (calculated using TTM income statement data). Hatcher Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Hatcher Group ROC % Historical Data

The historical data trend for Hatcher 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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Hatcher Group ROC % Chart

Hatcher Group Annual Data

Trend

Sep14

Sep15

Sep16

Sep17

Sep18

Sep19

Sep20

Sep21

Sep22

Sep23

ROC %

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-38.03

-40.50

-29.94

3.93

-25.49

Hatcher Group Quarterly Data
	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23
ROC %	Get a 7-Day Free Trial															-6.94	-62.28	-15.43	9.51	-16.46

Hatcher Group ROC % Calculation

Hatcher Group's annualized Return on Capital (ROC %) for the fiscal year that ended in Sep. 2023 is calculated as:

	ROC % (A: Sep. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Sep. 2022 )	+	Invested Capital (A: Sep. 2023 ))	/ count )
=	-38.329 * ( 1 - -7.95% )	/	( (146.461	+	178.189)	/ 2 )
=	-41.3761555	/	162.325
=	-25.49 %

where

	Invested Capital		(A: Sep. 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	))
=	266.607	-	109.302	-	( 21.167	-	max(0, 181.415	-	192.259	+	21.167	))
=	146.461

	Invested Capital		(A: Sep. 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	))
=	272.593	-	38.635	-	( 55.769	-	max(0, 67.123	-	142.454	+	55.769	))
=	178.189

Hatcher Group's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2023 is calculated as:

	ROC % (Q: Sep. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2023 )	+	Invested Capital (Q: Sep. 2023 ))	/ count )
=	-69.352 * ( 1 - 57.7% )	/	( (0	+	178.189)	/ 1 )
=	-29.335896	/	178.189
=	-16.46 %

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	))
=	0	-	0	-	( 0	-	max(0, 0	-	0	+	0	))
=	0

	Invested Capital		(Q: Sep. 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	))
=	272.593	-	38.635	-	( 55.769	-	max(0, 67.123	-	142.454	+	55.769	))
=	178.189

Note: The Operating Income data used here is four times the quarterly (Sep. 2023) data.

Hatcher Group (HKSE:08365) 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, Hatcher Group's WACC % is 3.53%. Hatcher Group's ROC % is -27.20% (calculated using TTM income statement data). Hatcher 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.

Hatcher Group ROC % Related Terms

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Hatcher Group (HKSE:08365) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Capital Markets » Hatcher Group Ltd (HKSE:08365) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

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Address

181 Queen’s Road Central, 21/F, Low Block, Grand Millennium Plaza, Hong Kong, HKG

Website

https://hatcher-group.com

Hatcher Group Ltd is a financial services provider. It has two operating segments; Licensed business; Provision of asset management services, corporate finance, advisory services, placing and, underwriting services, securities brokerage and margin financing, and Non-licensed business; Provision of accounting and taxation services, business consulting services, corporate secretarial services, ESG advisory services, human resources services, and risk management and internal control advisory services. majority of its revenue comes from non-licensed businesses.

Executives

Tanner Enterprises Group Limited
Li Man Keung Edwin
Gan Fanglun	2101 Beneficial owner
Jayden Wealth Limited	2101 Beneficial owner
Wan Ho Yan Letty	2201 Interest of corporation controlled by you
Li Chun Fung

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