Heatec Jietong Holdings (SGX:5OR) ROC % : 1.15% (As of Jun. 2024)

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What is Heatec Jietong Holdings 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 %. Heatec Jietong Holdings's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was 1.15%.

As of today (2024-12-14), Heatec Jietong Holdings's WACC % is -2.06%. Heatec Jietong Holdings's ROC % is 3.09% (calculated using TTM income statement data). Heatec Jietong Holdings 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.

Heatec Jietong Holdings ROC % Historical Data

The historical data trend for Heatec Jietong Holdings'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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Heatec Jietong Holdings ROC % Chart

Heatec Jietong Holdings Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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-8.11

2.93

-9.09

-0.96

3.23

Heatec Jietong Holdings Semi-Annual Data
	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23	Jun24
ROC %	Get a 7-Day Free Trial															-4.27	2.59	0.75	5.07	1.15

Heatec Jietong Holdings ROC % Calculation

Heatec Jietong Holdings'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 )
=	0.627 * ( 1 - 0.23% )	/	( (19.096	+	19.686)	/ 2 )
=	0.6255579	/	19.391
=	3.23 %

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	))
=	22.56	-	1.715	-	( 1.749	-	max(0, 9.373	-	13.819	+	1.749	))
=	19.096

	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	))
=	25.267	-	3.7	-	( 1.881	-	max(0, 10.818	-	16.086	+	1.881	))
=	19.686

Heatec Jietong Holdings'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 )
=	0.194 * ( 1 - -12.73% )	/	( (19.686	+	18.398)	/ 2 )
=	0.2186962	/	19.042
=	1.15 %

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	))
=	25.267	-	3.7	-	( 1.881	-	max(0, 10.818	-	16.086	+	1.881	))
=	19.686

	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	))
=	23.703	-	3.668	-	( 1.637	-	max(0, 10.165	-	14.946	+	1.637	))
=	18.398

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

Heatec Jietong Holdings (SGX:5OR) 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, Heatec Jietong Holdings's WACC % is -2.06%. Heatec Jietong Holdings's ROC % is 3.09% (calculated using TTM income statement data). Heatec Jietong Holdings 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.

Heatec Jietong Holdings ROC % Related Terms

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Heatec Jietong Holdings Business Description

Industry

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Address

No. 10 Tuas South Street 15, Singapore, SGP, 637076

Website

http://www.heatecholdings.com

Heatec Jietong Holdings Ltd is engaged in offering piping and heat exchanger services for the marine and oil and gas industries. The company's segments include Piping, Heat Exchangers, Trading and Chemical cleaning. The Piping segment is engaged in the fabrication and installation of various types of piping. The Heat Exchanger segment, which derives the majority of revenue, engages in servicing and fabrication of heat exchangers. The Chemical cleaning segment is engaged in the provision of chemical cleaning services to ships and marine vessels. The Group's operations are carried out in Singapore.

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