Auction Technology Group (LSE:ATG) ROC % : 5.50% (As of Mar. 2024)

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What is Auction Technology 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 %. Auction Technology Group's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was 5.50%.

As of today (2024-06-14), Auction Technology Group's WACC % is 12.70%. Auction Technology Group's ROC % is 2.70% (calculated using TTM income statement data). Auction Technology Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Auction Technology Group ROC % Historical Data

The historical data trend for Auction Technology 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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Auction Technology Group ROC % Chart

Auction Technology Group Annual Data

Trend

Sep18

Sep19

Sep20

Sep21

Sep22

Sep23

ROC %

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20.72

-7.06

-6.92

-1.81

7.08

Auction Technology Group Semi-Annual Data
	Sep18	Sep19	Sep20	Mar21	Sep21	Mar22	Sep22	Mar23	Sep23	Mar24
ROC %	Get a 7-Day Free Trial					1.86	-3.11	76.81	1.34	5.50

Auction Technology Group ROC % Calculation

Auction Technology 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 )
=	22.576 * ( 1 - -137.03% )	/	( (780.784	+	730.167)	/ 2 )
=	53.5118928	/	755.4755
=	7.08 %

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	))
=	806.955	-	7.983	-	( 49.427	-	max(0, 50.984	-	69.172	+	49.427	))
=	780.784

	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	))
=	726.039	-	12.303	-	( 6.097	-	max(0, 42.965	-	26.534	+	6.097	))
=	730.167

Auction Technology Group's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2024 is calculated as:

	ROC % (Q: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Mar. 2024 ))	/ count )
=	21.048 * ( 1 - -109.07% )	/	( (730.167	+	869.272)	/ 2 )
=	44.0050536	/	799.7195
=	5.50 %

where

	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	))
=	726.039	-	12.303	-	( 6.097	-	max(0, 42.965	-	26.534	+	6.097	))
=	730.167

	Invested Capital		(Q: Mar. 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	))
=	871.524	-	14.67	-	( 5.604	-	max(0, 39.381	-	26.963	+	5.604	))
=	869.272

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

Auction Technology Group (LSE:ATG) 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, Auction Technology Group's WACC % is 12.70%. Auction Technology Group's ROC % is 2.70% (calculated using TTM income statement data). Auction Technology 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.

Auction Technology Group ROC % Related Terms

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Auction Technology Group (LSE:ATG) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » Auction Technology Group PLC (LSE:ATG) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

ATHGF:USA ATGl:UK 684:Germany

Address

65 Southwark Street, The Harlequin Building, London, GBR, SE1 0HR

Website

https://www.auctiontechnologygroup.com

Auction Technology Group PLC is engaged in the provision of auction technology software and related services to auction houses and other customers. Its goal is to simplify and integrate multiple parts of the online auction process, from the cataloguing of items to marketing, auction hosting, bidding and recent payment solutions. The group has four segments namely Arts and Antiques, Industrial and Commercial, Auction services, and Content. The majority of revenue is generated from Art & Antiques segment. Geographically the company serves the United Kingdom, Germany, and USA, where the majority of revenue is generated from USA.

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