Polarean Imaging (LSE:POLX) ROC % : -325.78% (As of Jun. 2023)

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What is Polarean Imaging 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 %. Polarean Imaging's annualized return on capital (ROC %) for the quarter that ended in Jun. 2023 was -325.78%.

As of today (2024-05-17), Polarean Imaging's WACC % is 11.28%. Polarean Imaging's ROC % is -329.41% (calculated using TTM income statement data). Polarean Imaging earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Polarean Imaging ROC % Historical Data

The historical data trend for Polarean Imaging'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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Polarean Imaging ROC % Chart

Polarean Imaging Annual Data

Trend

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

ROC %

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-71.76

-89.41

-140.83

-298.10

-265.59

Polarean Imaging Semi-Annual Data
	Dec16	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23
ROC %	Get a 7-Day Free Trial								-275.36	-447.54	-298.54	-293.53	-325.78

Polarean Imaging ROC % Calculation

Polarean Imaging's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2022 is calculated as:

	ROC % (A: Dec. 2022 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2021 )	+	Invested Capital (A: Dec. 2022 ))	/ count )
=	-11.224 * ( 1 - 0% )	/	( (3.948	+	4.504)	/ 2 )
=	-11.224	/	4.226
=	-265.59 %

where

	Invested Capital		(A: Dec. 2021 )
=	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	))
=	25.967	-	0.305	-	( 21.714	-	max(0, 1.482	-	23.517	+	21.714	))
=	3.948

	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	))
=	18.503	-	0.49	-	( 13.509	-	max(0, 1.815	-	16.276	+	13.509	))
=	4.504

Polarean Imaging's annualized Return on Capital (ROC %) for the quarter that ended in Jun. 2023 is calculated as:

	ROC % (Q: Jun. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2022 )	+	Invested Capital (Q: Jun. 2023 ))	/ count )
=	-12.044 * ( 1 - 0% )	/	( (4.504	+	2.89)	/ 2 )
=	-12.044	/	3.697
=	-325.78 %

where

	Invested Capital		(Q: 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	))
=	18.503	-	0.49	-	( 13.509	-	max(0, 1.815	-	16.276	+	13.509	))
=	4.504

	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	))
=	12.434	-	1.719	-	( 7.825	-	max(0, 1.936	-	10.65	+	7.825	))
=	2.89

Note: The Operating Income data used here is two times the semi-annual (Jun. 2023) data.

Polarean Imaging (LSE:POLX) 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, Polarean Imaging's WACC % is 11.28%. Polarean Imaging's ROC % is -329.41% (calculated using TTM income statement data). Polarean Imaging 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.

Polarean Imaging ROC % Related Terms

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Polarean Imaging (LSE:POLX) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » Polarean Imaging PLC (LSE:POLX) » Definitions » ROC %

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Traded in Other Exchanges

PLLWF:USA 8ZF:Germany

Address

27-28 Eastcastle Street, London, GBR, W1W 8DH

Website

https://www.polarean.com

Polarean Imaging PLC designs and manufactures medical drug-device combination companies operating in the high-resolution medical imaging market. Its only operating segment being the development and commercialization of gas polariser devices and ancillary instruments. Geographically, it derives most of the revenue from the United States of America and also has a presence in Canada and the United Kingdom. The company generates revenue from products and services such as Polarisers, Parts and Upgrades, Service and other revenue. Its product portfolio includes 9820 129Xe Hyperpolarizer, 9800 129Xe Hyperpolarizer, Polarean 3777 129Xe Hyperpolarizer Upgrade Module, Polarean 2881 Polarization Measurement Station, and others.

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