Ecoscience International Bhd (XKLS:0255) ROC % : -8.84% (As of Mar. 2024)

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What is Ecoscience International Bhd 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 %. Ecoscience International Bhd's annualized return on capital (ROC %) for the quarter that ended in Mar. 2024 was -8.84%.

As of today (2024-06-24), Ecoscience International Bhd's WACC % is 9.25%. Ecoscience International Bhd's ROC % is -9.56% (calculated using TTM income statement data). Ecoscience International Bhd earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Ecoscience International Bhd ROC % Historical Data

The historical data trend for Ecoscience International Bhd'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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Ecoscience International Bhd ROC % Chart

Ecoscience International Bhd Annual Data

Trend

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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21.17

7.56

9.59

-3.97

-5.72

Ecoscience International Bhd Quarterly Data
	Dec18	Dec19	Dec20	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
ROC %	Get a 7-Day Free Trial								2.84	3.98	-10.79	-22.80	-8.84

Ecoscience International Bhd ROC % Calculation

Ecoscience International Bhd'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 )
=	-6.634 * ( 1 - -15.71% )	/	( (129.229	+	139.188)	/ 2 )
=	-7.6762014	/	134.2085
=	-5.72 %

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	))
=	173.008	-	31.443	-	( 12.336	-	max(0, 90.27	-	145.689	+	12.336	))
=	129.229

	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	))
=	170.709	-	23.727	-	( 7.794	-	max(0, 85.314	-	144.381	+	7.794	))
=	139.188

Ecoscience International Bhd's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2024 is calculated as:

	ROC % (Q: Mar. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Dec. 2023 )	+	Invested Capital (Q: Mar. 2024 ))	/ count )
=	-14.212 * ( 1 - 24.7% )	/	( (139.188	+	102.837)	/ 2 )
=	-10.701636	/	121.0125
=	-8.84 %

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	))
=	170.709	-	23.727	-	( 7.794	-	max(0, 85.314	-	144.381	+	7.794	))
=	139.188

	Invested Capital		(Q: Mar. 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	))
=	167.327	-	38.04	-	( 26.45	-	max(0, 86.653	-	140.999	+	26.45	))
=	102.837

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

Ecoscience International Bhd (XKLS:0255) 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, Ecoscience International Bhd's WACC % is 9.25%. Ecoscience International Bhd's ROC % is -9.56% (calculated using TTM income statement data). Ecoscience International Bhd 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.

Ecoscience International Bhd ROC % Related Terms

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Ecoscience International Bhd (XKLS:0255) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Construction » Ecoscience International Bhd (XKLS:0255) » Definitions » ROC %

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Address

Pasir Gudang Industrial Estate, PLO555, Jalan Keluli 8, Pasir Gudang, JHR, MYS, 81700

Website

https://www.ecosciencegroup.com

Ecoscience International Bhd is a one-stop solution provider for the construction of palm oil mills and supporting facilities, and fabrication of equipment. The core activities of the company is the construction of plants, which are mainly palm oil mills and facilities, supported by our in-house fabrication of equipment. Other complementary activities include supply of materials and equipment, spare parts and provision of maintenance services. The company's reportable segments are as follows which includes Construction of Plants and Facilities Segment, Fabrication of Equipment Segment, Supply of Material and Equipment, Others. The company generates majority of its revenue from Construction of Plants and Facilities Segment in Malaysia region itself.

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