The Flowr (TSXV:FLWR.H) ROC % : -39.09% (As of Sep. 2022)

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What is The Flowr 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 %. The Flowr's annualized return on capital (ROC %) for the quarter that ended in Sep. 2022 was -39.09%.

As of today (2024-06-23), The Flowr's WACC % is 0.00%. The Flowr's ROC % is 0.00% (calculated using TTM income statement data). The Flowr earns returns that do not match up to its cost of capital. It will destroy value as it grows.

The Flowr ROC % Historical Data

The historical data trend for The Flowr'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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The Flowr ROC % Chart

The Flowr Annual Data

Trend

Jun17

Jun18

Dec19

Dec20

Dec21

ROC %

-25.93

-659.26

-22.02

-18.70

-25.22

The Flowr Quarterly Data
	Sep17	Mar18	Jun18	Sep18	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22
ROC %	Get a 7-Day Free Trial															-18.98	-48.07	-27.28	-16.72	-39.09

The Flowr ROC % Calculation

The Flowr's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2021 is calculated as:

	ROC % (A: Dec. 2021 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2020 )	+	Invested Capital (A: Dec. 2021 ))	/ count )
=	-30.73 * ( 1 - 3.13% )	/	( (156.189	+	79.846)	/ 2 )
=	-29.768151	/	118.0175
=	-25.22 %

where

	Invested Capital		(A: Dec. 2020 )
=	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	))
=	180.999	-	12.016	-	( 20.774	-	max(0, 19.823	-	32.617	+	20.774	))
=	156.189

	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	))
=	87.056	-	7.613	-	( 4.196	-	max(0, 32.203	-	31.8	+	4.196	))
=	79.846

The Flowr's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2022 is calculated as:

	ROC % (Q: Sep. 2022 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2022 )	+	Invested Capital (Q: Sep. 2022 ))	/ count )
=	-11.756 * ( 1 - 0% )	/	( (38.783	+	21.372)	/ 2 )
=	-11.756	/	30.0775
=	-39.09 %

where

	Invested Capital		(Q: Jun. 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	))
=	50.519	-	10.501	-	( 1.235	-	max(0, 25.353	-	28.685	+	1.235	))
=	38.783

	Invested Capital		(Q: Sep. 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	))
=	28.538	-	5.687	-	( 1.479	-	max(0, 6.276	-	8.788	+	1.479	))
=	21.372

Note: The Operating Income data used here is four times the quarterly (Sep. 2022) data.

The Flowr (TSXV:FLWR.H) 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, The Flowr's WACC % is 0.00%. The Flowr's ROC % is 0.00% (calculated using TTM income statement data). The Flowr 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.

The Flowr ROC % Related Terms

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The Flowr (TSXV:FLWR.H) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Drug Manufacturers » The Flowr Corp (TSXV:FLWR.H) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

9590 McCarthy Road, Kelowna, BC, CAN, V4V 1R2

Website

https://www.flowr.ca

The Flowr Corp is a Toronto-headquartered cannabis company with operations in Canada and Europe. Its Canadian operating campus, located in Kelowna, BC, includes a purpose-built, GMP-designed indoor cultivation facility; an outdoor and greenhouse cultivation site; and a R&D facility that is awaiting licensing from Health Canada. From this campus, Flowr produces recreational and medicinal products. Internationally, it intends to service the global medical cannabis market through its subsidiary Holigen, which has a license for cannabis cultivation in Portugal and operates GMP licensed facilities in Portugal.

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