Ajax Resources (LSE:AJAX) ROC % : -113.14% (As of Aug. 2024)

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What is Ajax 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 %. Ajax Resources's annualized return on capital (ROC %) for the quarter that ended in Aug. 2024 was -113.14%.

As of today (2025-03-23), Ajax Resources's WACC % is 10.59%. Ajax Resources's ROC % is -163.15% (calculated using TTM income statement data). Ajax Resources earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Ajax Resources ROC % Historical Data

The historical data trend for Ajax 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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Ajax Resources ROC % Chart

Ajax Resources Annual Data

Trend

Feb22

Feb23

Feb24

ROC %

-200.97

-185.58

Ajax Resources Semi-Annual Data
	Aug22	Feb23	Aug23	Feb24	Aug24
ROC %	-2,177.78	-659.12	-105.86	-429.63	-113.14

Ajax Resources ROC % Calculation

Ajax Resources's annualized Return on Capital (ROC %) for the fiscal year that ended in Feb. 2024 is calculated as:

	ROC % (A: Feb. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Feb. 2023 )	+	Invested Capital (A: Feb. 2024 ))	/ count )
=	-0.296 * ( 1 - 0% )	/	( (0.309	+	0.01)	/ 2 )
=	-0.296	/	0.1595
=	-185.58 %

where

	Invested Capital		(A: Feb. 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	))
=	1.111	-	0.045	-	( 0.757	-	max(0, 0.045	-	1.111	+	0.757	))
=	0.309

	Invested Capital		(A: Feb. 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	))
=	0.982	-	0.085	-	( 0.974	-	max(0, 0.095	-	0.982	+	0.974	))
=	0.01

Ajax Resources's annualized Return on Capital (ROC %) for the quarter that ended in Aug. 2024 is calculated as:

	ROC % (Q: Aug. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Feb. 2024 )	+	Invested Capital (Q: Aug. 2024 ))	/ count )
=	-0.198 * ( 1 - 0% )	/	( (0.01	+	0.34)	/ 2 )
=	-0.198	/	0.175
=	-113.14 %

where

	Invested Capital		(Q: Feb. 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	))
=	0.982	-	0.085	-	( 0.974	-	max(0, 0.095	-	0.982	+	0.974	))
=	0.01

	Invested Capital		(Q: Aug. 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	))
=	0.848	-	0.052	-	( 0.456	-	max(0, 0.052	-	0.848	+	0.456	))
=	0.34

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

Ajax Resources (LSE:AJAX) 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, Ajax Resources's WACC % is 10.59%. Ajax Resources's ROC % is -163.15% (calculated using TTM income statement data). Ajax 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.

Ajax Resources ROC % Related Terms

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Ajax Resources Business Description

Industry

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Traded in Other Exchanges

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Address

London Wall, Salisbury House, London, GBR, EC2M 5PS

Website

https://www.ajaxresources.com

Ajax Resources PLC is a special purpose acquisition company formed to raise capital in an initial public offering with the purpose of using the proceeds to acquire one or more unspecified businesses or assets.