Mercantile Ports and Logistics (STU:9KS0) ROC % : -4.11% (As of Jun. 2024)

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What is Mercantile Ports and Logistics 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 %. Mercantile Ports and Logistics's annualized return on capital (ROC %) for the quarter that ended in Jun. 2024 was -4.11%.

As of today (2024-12-12), Mercantile Ports and Logistics's WACC % is 13.62%. Mercantile Ports and Logistics's ROC % is -4.13% (calculated using TTM income statement data). Mercantile Ports and Logistics earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Mercantile Ports and Logistics ROC % Historical Data

The historical data trend for Mercantile Ports and Logistics'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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Mercantile Ports and Logistics ROC % Chart

Mercantile Ports and Logistics Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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-0.03

-2.86

-5.07

-3.72

-4.11

Mercantile Ports and Logistics 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															-4.55	-2.61	-3.95	-4.23	-4.11

Mercantile Ports and Logistics ROC % Calculation

Mercantile Ports and Logistics'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 )
=	-6.053 * ( 1 - 0% )	/	( (155.771	+	139.002)	/ 2 )
=	-6.053	/	147.3865
=	-4.11 %

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	))
=	165.882	-	9.664	-	( 0.447	-	max(0, 13.864	-	16.976	+	0.447	))
=	155.771

	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	))
=	147.413	-	4.866	-	( 3.545	-	max(0, 17.963	-	25.048	+	3.545	))
=	139.002

Mercantile Ports and Logistics'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 )
=	-5.79 * ( 1 - 0% )	/	( (139.002	+	142.769)	/ 2 )
=	-5.79	/	140.8855
=	-4.11 %

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	))
=	147.413	-	4.866	-	( 3.545	-	max(0, 17.963	-	25.048	+	3.545	))
=	139.002

	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	))
=	147.348	-	4.222	-	( 1.319	-	max(0, 23.359	-	23.716	+	1.319	))
=	142.769

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

Mercantile Ports and Logistics (STU:9KS0) 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, Mercantile Ports and Logistics's WACC % is 13.62%. Mercantile Ports and Logistics's ROC % is -4.13% (calculated using TTM income statement data). Mercantile Ports and Logistics 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.

Mercantile Ports and Logistics ROC % Related Terms

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Mercantile Ports and Logistics Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Transportation » Mercantile Ports and Logistics Ltd (STU:9KS0) » Definitions » ROC %

Traded in Other Exchanges

MPL.GB:UK MPL:UK

Address

Le Bordage Road, 1st Floor, Tudor House, Saint Peter Port, GGY, GY1 1DB

Website

https://www.mercpl.com

Mercantile Ports and Logistics Ltd develops, owns, and operates port and logistics facilities. The site of the company's first project is at Karanja Creek in the Raigad district of Maharashtra, where it intends to develop and operate a modern and efficient port and logistics complex. At the Karanja port, the company focuses on mid-stream discharge and loading of cargo while vessels wait at anchorage for a berth in JNPT, and coastal movement of cargoes, such as containers, cement, and other break-bulk cargo, which typically ply in smaller vessels. The company has only one operating and geographic segment, being the project on hand in India. The company generates the majority of its revenue from lease income operations.

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