FirstWave Cloud Technology (ASX:FCT) ROIC % : -11.84% (As of Jun. 2024)

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What is FirstWave Cloud Technology 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 %. FirstWave Cloud Technology's annualized return on invested capital (ROIC %) for the quarter that ended in Jun. 2024 was -11.84%.

As of today (2024-12-12), FirstWave Cloud Technology's WACC % is 20.57%. FirstWave Cloud Technology's ROIC % is -12.03% (calculated using TTM income statement data). FirstWave Cloud Technology earns returns that do not match up to its cost of capital. It will destroy value as it grows.

FirstWave Cloud Technology ROIC % Historical Data

The historical data trend for FirstWave Cloud Technology'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.

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FirstWave Cloud Technology ROIC % Chart

FirstWave Cloud Technology Annual Data

Trend

Jun15

Jun16

Jun17

Jun18

Jun19

Jun20

Jun21

Jun22

Jun23

Jun24

ROIC %

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-151.64

-123.54

-39.96

-19.75

-12.99

FirstWave Cloud Technology 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															-33.95	-17.06	-21.37	-11.44	-11.84

Competitive Comparison of FirstWave Cloud Technology's ROIC %

For the Software - Infrastructure subindustry, FirstWave Cloud Technology'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.

FirstWave Cloud Technology's ROIC % Distribution in the Software Industry

For the Software industry and Technology sector, FirstWave Cloud Technology's ROIC % distribution charts can be found below:

* The bar in red indicates where FirstWave Cloud Technology's ROIC % falls into.

FirstWave Cloud Technology ROIC % Calculation

FirstWave Cloud Technology's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Jun. 2024 is calculated as:

	ROIC % (A: Jun. 2024 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Jun. 2023 )	+	Invested Capital (A: Jun. 2024 ))	/ count )
=	-6.493 * ( 1 - -0.02% )	/	( (59.118	+	40.898)	/ 2 )
=	-6.4942986	/	50.008
=	-12.99 %

where

	Invested Capital		(A: Jun. 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	))
=	63.33	-	2.862	-	( 5.741	-	max(0, 8.467	-	9.817	+	5.741	))
=	59.118

	Invested Capital		(A: 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	))
=	41.869	-	1.738	-	( 1.812	-	max(0, 5.531	-	4.764	+	1.812	))
=	40.898

FirstWave Cloud Technology'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 )
=	-6.086 * ( 1 - 0.02% )	/	( (61.904	+	40.898)	/ 2 )
=	-6.0847828	/	51.401
=	-11.84 %

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	))
=	62.41	-	2.419	-	( 2.08	-	max(0, 7.84	-	5.927	+	2.08	))
=	61.904

	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	))
=	41.869	-	1.738	-	( 1.812	-	max(0, 5.531	-	4.764	+	1.812	))
=	40.898

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

FirstWave Cloud Technology (ASX:FCT) 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, FirstWave Cloud Technology's WACC % is 20.57%. FirstWave Cloud Technology's ROIC % is -12.03% (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.

FirstWave Cloud Technology ROIC % Related Terms

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FirstWave Cloud Technology Business Description

Industry

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Comparable Companies

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Address

132 Arthur Street, Level 14, North Sydney, Sydney, NSW, AUS, 2060

Website

https://www.firstwave.com

FirstWave Cloud Technology Ltd is engaged in the development and sale of internet security software. The products of the company include NMIS which is a open source network management software, CyberCision Platform, Email security, Web security among others. The company has one reportable segment being the development and sale of internet security software.