Kooth (LSE:KOO) ROC % : 35.19% (As of Jun. 2024)

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What is Kooth 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 %. Kooth's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was 35.19%.

As of today (2024-12-13), Kooth's WACC % is 11.81%. Kooth's ROC % is 21.19% (calculated using TTM income statement data). Kooth generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.

Kooth ROC % Historical Data

The historical data trend for Kooth'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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Kooth ROC % Chart

Kooth Annual Data

Trend

Dec16

Dec17

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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-7.63

-10.25

-6.12

-11.44

-1.37

Kooth Semi-Annual Data
	Dec17	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23	Jun24
ROC %	Get a 7-Day Free Trial							-10.83	-11.66	-10.75	8.29	35.19

Kooth ROC % Calculation

Kooth'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 )
=	-2.262 * ( 1 - 91.4% )	/	( (8.358	+	19.977)	/ 2 )
=	-0.194532	/	14.1675
=	-1.37 %

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	))
=	16.141	-	1.647	-	( 8.492	-	max(0, 5.623	-	11.759	+	8.492	))
=	8.358

	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	))
=	30.685	-	2.206	-	( 11.004	-	max(0, 9.927	-	18.429	+	11.004	))
=	19.977

Kooth'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 )
=	9.376 * ( 1 - 21.44% )	/	( (19.977	+	21.883)	/ 2 )
=	7.3657856	/	20.93
=	35.19 %

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	))
=	30.685	-	2.206	-	( 11.004	-	max(0, 9.927	-	18.429	+	11.004	))
=	19.977

	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	))
=	35.891	-	1.313	-	( 14.94	-	max(0, 10.636	-	23.331	+	14.94	))
=	21.883

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

Kooth (LSE:KOO) 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, Kooth's WACC % is 11.81%. Kooth's ROC % is 21.19% (calculated using TTM income statement data). Kooth generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.

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.

Kooth ROC % Related Terms

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Kooth Business Description

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KO0:Germany

Address

5 Merchant Square, London, GBR, W2 1AY

Website

https://www.koothplc.com

Kooth PLC is a digital mental health provider to the NHS for children and young people by providing a broad range of therapeutic tools and interventions. The company's online platform provides Self-help tools and content, Community for Peer-to-Peer Support and Professional Counselling. It provides individuals with free access to mental health support, funded by healthcare systems, insurers, businesses or charities. The company's operations take place in the UK and the United States.

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