Pacific Software (Pacific Software) ROIC % : -24.15% (As of Jun. 2013)

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What is Pacific Software 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 %. Pacific Software's annualized return on invested capital (ROIC %) for the quarter that ended in Jun. 2013 was -24.15%.

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

Pacific Software ROIC % Historical Data

The historical data trend for Pacific Software'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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Pacific Software ROIC % Chart

Pacific Software Annual Data

Trend

Sep07

Sep08

Sep09

Sep10

Sep11

Sep12

ROIC %

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-278.57

Pacific Software Quarterly Data
	Sep08	Dec08	Mar09	Jun09	Sep09	Dec09	Mar10	Jun10	Sep10	Dec10	Mar11	Jun11	Sep11	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13
ROIC %	Get a 7-Day Free Trial															-	-	-	-	-24.15

Competitive Comparison of Pacific Software's ROIC %

For the Restaurants subindustry, Pacific Software'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.

Pacific Software's ROIC % Distribution in the Restaurants Industry

For the Restaurants industry and Consumer Cyclical sector, Pacific Software's ROIC % distribution charts can be found below:

* The bar in red indicates where Pacific Software's ROIC % falls into.

Pacific Software ROIC % Calculation

Pacific Software's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Sep. 2012 is calculated as:

	ROIC % (A: Sep. 2012 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Sep. 2011 )	+	Invested Capital (A: Sep. 2012 ))	/ count )
=	-0.044 * ( 1 - % )	/	( (0	+	0)	/ 1 )
=	-0.044	/	0
=	%

where

	Invested Capital		(A: Sep. 2011 )
=	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	))
=	0.001	-	0.112	-	( 0	-	max(0, 0.112	-	0.001	+	0	))
=	0

	Invested Capital		(A: Sep. 2012 )
=	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	))
=	0	-	0.162	-	( 0	-	max(0, 0.162	-	0	+	0	))
=	0

Pacific Software's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Jun. 2013 is calculated as:

	ROIC % (Q: Jun. 2013 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2013 )	+	Invested Capital (Q: Jun. 2013 ))	/ count )
=	-0.092 * ( 1 - 0% )	/	( (0	+	0.381)	/ 1 )
=	-0.092	/	0.381
=	-24.15 %

where

	Invested Capital		(Q: Mar. 2013 )
=	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	))
=	0	-	0.199	-	( 0	-	max(0, 0.199	-	0	+	0	))
=	0

	Invested Capital		(Q: Jun. 2013 )
=	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	))
=	0.592	-	0.211	-	( 0	-	max(0, 0.211	-	0.592	+	0	))
=	0.381

Note: The Operating Income data used here is four times the quarterly (Jun. 2013) data.

Pacific Software (OTCPK:PFSF) 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, Pacific Software's WACC % is 0.00%. Pacific Software's ROIC % is 0.00% (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.

Pacific Software ROIC % Related Terms

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