Friedrich Vorwerk Group SE (XTER:VH2) ROC % : 15.27% (As of Sep. 2024)

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What is Friedrich Vorwerk Group SE 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 %. Friedrich Vorwerk Group SE's annualized return on capital (ROC %) for the quarter that ended in Sep. 2024 was 15.27%.

As of today (2025-03-24), Friedrich Vorwerk Group SE's WACC % is 9.57%. Friedrich Vorwerk Group SE's ROC % is 7.92% (calculated using TTM income statement data). Friedrich Vorwerk Group SE earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Friedrich Vorwerk Group SE ROC % Historical Data

The historical data trend for Friedrich Vorwerk Group SE'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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Friedrich Vorwerk Group SE ROC % Chart

Friedrich Vorwerk Group SE Annual Data

Trend

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

16.92

21.52

18.94

4.42

-0.28

Friedrich Vorwerk Group SE Quarterly Data
	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24
ROC %	Get a 7-Day Free Trial															-2.58	6.14	-1.63	9.98	15.27

Friedrich Vorwerk Group SE ROC % Calculation

Friedrich Vorwerk Group SE'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 )
=	-0.847 * ( 1 - 19.33% )	/	( (243.672	+	240.727)	/ 2 )
=	-0.6832749	/	242.1995
=	-0.28 %

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	))
=	308.079	-	18.531	-	( 45.876	-	max(0, 90.147	-	177.009	+	45.876	))
=	243.672

	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	))
=	311.276	-	14.018	-	( 56.531	-	max(0, 93.73	-	173.579	+	56.531	))
=	240.727

Friedrich Vorwerk Group SE's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2024 is calculated as:

	ROC % (Q: Sep. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2024 )	+	Invested Capital (Q: Sep. 2024 ))	/ count )
=	67.02 * ( 1 - 30.87% )	/	( (300.358	+	306.38)	/ 2 )
=	46.330926	/	303.369
=	15.27 %

where

	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	))
=	316.971	-	8.442	-	( 8.171	-	max(0, 83.017	-	166.263	+	8.171	))
=	300.358

	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	))
=	372.091	-	13.712	-	( 51.999	-	max(0, 121.066	-	216.793	+	51.999	))
=	306.38

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

Friedrich Vorwerk Group SE (XTER:VH2) 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, Friedrich Vorwerk Group SE's WACC % is 9.57%. Friedrich Vorwerk Group SE's ROC % is 7.92% (calculated using TTM income statement data). Friedrich Vorwerk Group SE 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.

Friedrich Vorwerk Group SE ROC % Related Terms

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Friedrich Vorwerk Group SE Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Construction » Friedrich Vorwerk Group SE (XTER:VH2) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

FRVWY:USA

Address

Niedersachsenstrasse 19-21, Tostedt, DEU, 21255

Website

https://www.friedrich-vorwerk.de

Friedrich Vorwerk Group SE is a driver of the European energy transition. It has four segments Natural Gas segment, which is the key revenue driver, comprises the transport and conversion of raw natural gas into treated natural gas, Electricity segment provides infrastructure for the underground transport and conversion of electricity, which is generated from non-fossil energy sources such as wind, solar, hydro, and regenerative resources, Clean Hydrogen segment comprises the conversion of energy from energy sources into clean hydrogen and its transportation to consumers, Adjacent Opportunities segment concentrates on the related turnkey technologies, and the majority of its revenue comes from Adjacent Opportunities.

Executives

Torben Kleinfeldt	Board of Directors
Dr. Christof Nesemeier	Supervisory Board
Tim Hameister	Board of Directors
Dr. Julian Deutz	Supervisory Board
Heike Von Der Heyden	Supervisory Board

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