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AKAAF (Aker ASA) ROIC % : 0.75% (As of Jun. 2024)


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What is Aker ASA ROIC %?

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Aker ASA's annualized return on invested capital (ROIC %) for the quarter that ended in Jun. 2024 was 0.75%.

As of today (2024-12-11), Aker ASA's WACC % is 9.72%. Aker ASA's ROIC % is -1.75% (calculated using TTM income statement data). Aker ASA earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Aker ASA ROIC % Historical Data

The historical data trend for Aker ASA's ROIC % 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.

* Premium members only.

Aker ASA ROIC % Chart

Aker ASA Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
ROIC %
Get a 7-Day Free Trial Premium Member Only Premium Member Only -0.13 -1.14 -0.99 17.17 -5.70

Aker ASA Semi-Annual Data
Dec14 Jun15 Dec15 Jun16 Dec16 Jun17 Dec17 Jun18 Dec18 Jun19 Dec19 Jun20 Dec20 Jun21 Dec21 Jun22 Dec22 Jun23 Dec23 Jun24
ROIC % Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 35.05 -3.16 -4.16 -4.11 0.75

Competitive Comparison of Aker ASA's ROIC %

For the Conglomerates subindustry, Aker ASA's ROIC %, along with its competitors' market caps and ROIC % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Aker ASA's ROIC % Distribution in the Conglomerates Industry

For the Conglomerates industry and Industrials sector, Aker ASA's ROIC % distribution charts can be found below:

* The bar in red indicates where Aker ASA's ROIC % falls into.



Aker ASA ROIC % Calculation

Aker ASA's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2023 is calculated as:

ROIC % (A: Dec. 2023 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Dec. 2022 ) + Invested Capital (A: Dec. 2023 ))/ count )
=-399.075 * ( 1 - -14.82% )/( (8443.133 + 7643.089)/ 2 )
=-458.217915/8043.111
=-5.70 %

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))
=9843.929 - 166.294 - ( 1336.829 - max(0, 1034.706 - 2269.208+1336.829))
=8443.133

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))
=8412.896 - 147.971 - ( 798.244 - max(0, 1014.181 - 1636.017+798.244))
=7643.089

Aker ASA's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Jun. 2024 is calculated as:

ROIC % (Q: Jun. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Dec. 2023 ) + Invested Capital (Q: Jun. 2024 ))/ count )
=62.928 * ( 1 - 1.12% )/( (7643.089 + 9056.747)/ 2 )
=62.2232064/8349.918
=0.75 %

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))
=8412.896 - 147.971 - ( 798.244 - max(0, 1014.181 - 1636.017+798.244))
=7643.089

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))
=10562.767 - 372.949 - ( 1133.071 - max(0, 1066.093 - 2622.134+1133.071))
=9056.747

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

* 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.


Aker ASA  (OTCPK:AKAAF) ROIC % Explanation

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. 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 ROIC % 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, Aker ASA's WACC % is 9.72%. Aker ASA's ROIC % is -1.75% (calculated using TTM income statement data).


Be Aware

Like ROE % and ROA %, ROIC % 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.


Aker ASA ROIC % Related Terms

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Aker ASA Business Description

Address
Oksenoyveien 10, Lysaker, Oslo, NOR, 1366
Aker ASA is an industrial investment company that develops businesses and exercises active ownership to create value for its shareholders and society at large. The portfolio has focused on companies in oil and gas, maritime assets, seafood/marine biotechnology, and real estate sectors. Investments are broken down into two portfolios; Industrial holdings are strategic assets and are managed with a long-term perspective. It comprises Aker's ownership interests in Aker BP, Aker Energy, Aker Solutions, Aker Horizons, Aker BioMarine, SalMar Aker Ocean, Cognite, and Aize, and Financial investments comprise cash, other assets, and the listed companies Akastor, AMSC, Philly Shipyard, and Solstad Offshore, in addition to ICP and Aker Property Group.