Tung Ho Textile Co (TPE:1414) ROC % : 0.05% (As of Dec. 2024)

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What is Tung Ho Textile Co 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 %. Tung Ho Textile Co's annualized return on capital (ROC %) for the quarter that ended in Dec. 2024 was 0.05%.

As of today (2025-03-24), Tung Ho Textile Co's WACC % is 3.00%. Tung Ho Textile Co's ROC % is -0.40% (calculated using TTM income statement data). Tung Ho Textile Co earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Tung Ho Textile Co ROC % Historical Data

The historical data trend for Tung Ho Textile Co'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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Tung Ho Textile Co ROC % Chart

Tung Ho Textile Co Annual Data

Trend

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Dec24

ROC %

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-0.28

2.34

1.72

-1.17

-0.40

Tung Ho Textile Co Quarterly Data
	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24	Dec24
ROC %	Get a 7-Day Free Trial															-0.02	0.07	-0.30	-0.50	0.05

Tung Ho Textile Co ROC % Calculation

Tung Ho Textile Co's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2024 is calculated as:

	ROC % (A: Dec. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2023 )	+	Invested Capital (A: Dec. 2024 ))	/ count )
=	-15.952 * ( 1 - 3.24% )	/	( (3971.345	+	3776.488)	/ 2 )
=	-15.4351552	/	3873.9165
=	-0.40 %

where

	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	))
=	4491.146	-	53.424	-	( 639.658	-	max(0, 675.905	-	1142.282	+	639.658	))
=	3971.345

	Invested Capital		(A: Dec. 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	))
=	4351.804	-	44.142	-	( 640.747	-	max(0, 510.532	-	1041.706	+	640.747	))
=	3776.488

Tung Ho Textile Co's annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2024 is calculated as:

	ROC % (Q: Dec. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2024 )	+	Invested Capital (Q: Dec. 2024 ))	/ count )
=	-35.128 * ( 1 - 105.38% )	/	( (3814.344	+	3776.488)	/ 2 )
=	1.8898864	/	3795.416
=	0.05 %

where

	Invested Capital		(Q: Sep. 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	))
=	4405.258	-	59.39	-	( 681.678	-	max(0, 556.18	-	1087.704	+	681.678	))
=	3814.344

	Invested Capital		(Q: Dec. 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	))
=	4351.804	-	44.142	-	( 640.747	-	max(0, 510.532	-	1041.706	+	640.747	))
=	3776.488

Note: The Operating Income data used here is four times the quarterly (Dec. 2024) data.

Tung Ho Textile Co (TPE:1414) 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, Tung Ho Textile Co's WACC % is 3.00%. Tung Ho Textile Co's ROC % is -0.40% (calculated using TTM income statement data). Tung Ho Textile Co 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.

Tung Ho Textile Co ROC % Related Terms

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Tung Ho Textile Co Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Manufacturing - Apparel & Accessories » Tung Ho Textile Co Ltd (TPE:1414) » Definitions » ROC %

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Traded in Other Exchanges

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Address

No. 227, Gongye Road, Bitouli, Madou District, Tainan, TWN, 721

Website

http://www.tungho.com.tw

Tung Ho Textile Co Ltd is a Taiwan-based company that engages in the manufacturing and development of textile materials. Its product portfolio includes pure cotton, blended yarn, slub yarn, bamboo charcoal yarn, fine wool, hollow charcoal fiber yarn, recycled polyester yarn, organic cotton yarn, and others. The company's operating segment includes Spinning and Headquarters. It generates maximum revenue from the Spinning segment that is engaged in the manufacture and sale of various spinning products. Geographically, the company generates a majority of its revenue from Taiwan and the rest from Mainland China, Japan, and other regions.

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