NEX Group (NEX Group) ROC % : 12.68% (As of Mar. 2018)

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What is NEX 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 %. NEX Group's annualized return on capital (ROC %) for the quarter that ended in Mar. 2018 was 12.68%.

As of today (2024-05-06), NEX Group's WACC % is 0.00%. NEX Group's ROC % is 0.00% (calculated using TTM income statement data). NEX Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.

NEX Group ROC % Historical Data

The historical data trend for NEX 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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NEX Group ROC % Chart

NEX Group Annual Data

Trend

Mar09

Mar10

Mar11

Mar12

Mar13

Mar14

Mar15

Mar16

Mar17

Mar18

ROC %

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8.38

2.61

2.34

3.91

8.73

NEX Group Semi-Annual Data
	Sep08	Mar09	Sep09	Mar10	Sep10	Mar11	Sep11	Mar12	Sep12	Mar13	Sep13	Mar14	Sep14	Mar15	Sep15	Mar16	Sep16	Mar17	Sep17	Mar18
ROC %	Get a 7-Day Free Trial															6.47	1.14	0.88	5.51	12.68

NEX Group ROC % Calculation

NEX Group's annualized Return on Capital (ROC %) for the fiscal year that ended in Mar. 2018 is calculated as:

	ROC % (A: Mar. 2018 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Mar. 2017 )	+	Invested Capital (A: Mar. 2018 ))	/ count )
=	220.67 * ( 1 - 10.4% )	/	( (1935.803	+	2594.973)	/ 2 )
=	197.72032	/	2265.388
=	8.73 %

where

	Invested Capital		(A: Mar. 2017 )
=	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	))
=	2379.012	-	81.481	-	( 397.531	-	max(0, 380.247	-	741.975	+	397.531	))
=	1935.803

	Invested Capital		(A: Mar. 2018 )
=	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	))
=	2402.235	-	89.385	-	( 377.095	-	max(0, 958.101	-	675.978	+	377.095	))
=	2594.973

NEX Group's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2018 is calculated as:

	ROC % (Q: Mar. 2018 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2017 )	+	Invested Capital (Q: Mar. 2018 ))	/ count )
=	279.33 * ( 1 - -2.6% )	/	( (1925.334	+	2594.973)	/ 2 )
=	286.59258	/	2260.1535
=	12.68 %

where

	Invested Capital		(Q: Sep. 2017 )
=	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	))
=	2256	-	196	-	( 290.667	-	max(0, 454.667	-	589.333	+	290.667	))
=	1925.334

	Invested Capital		(Q: Mar. 2018 )
=	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	))
=	2402.235	-	89.385	-	( 377.095	-	max(0, 958.101	-	675.978	+	377.095	))
=	2594.973

Note: The Operating Income data used here is two times the semi-annual (Mar. 2018) data.

NEX Group (GREY:NEXGY) 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, NEX Group's WACC % is 0.00%. NEX Group's ROC % is 0.00% (calculated using TTM income statement data). NEX 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.

NEX Group ROC % Related Terms

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NEX Group (NEX Group) Business Description

Industry

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Traded in Other Exchanges

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Address

Website

http://www.nex.com

NEX Group PLC provides electronic execution, risk mitigation, messaging, broking and information services for wholesale market participants. The Company's reportable segments include NEX Markets and NEX Optimisation. The company acts as an intermediary for FX and fixed income products through the Group's electronic platforms. It is also involved in a non-advisory capacity as principals in the matched purchase and sale of financial instruments between clients and provides technology development services.

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