Lonrho (LSE:LONR) Asset Turnover : 0.25 (As of Dec. 2012)

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What is Lonrho Asset Turnover?

Asset Turnover measures how quickly a company turns over its asset through sales. It is calculated as Revenue divided by Total Assets. Lonrho's Revenue for the six months ended in Dec. 2012 was £83.6 Mil. Lonrho's Total Assets for the quarter that ended in Dec. 2012 was £340.5 Mil. Therefore, Lonrho's Asset Turnover for the quarter that ended in Dec. 2012 was 0.25.

Asset Turnover is linked to ROE % through Du Pont Formula. Lonrho's annualized ROE % for the quarter that ended in Dec. 2012 was -32.80%. It is also linked to ROA % through Du Pont Formula. Lonrho's annualized ROA % for the quarter that ended in Dec. 2012 was -16.09%.

Lonrho Asset Turnover Historical Data

The historical data trend for Lonrho's Asset Turnover 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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Lonrho Asset Turnover Chart

Lonrho Annual Data

Trend

Sep03

Sep04

Sep05

Sep06

Sep07

Sep08

Sep09

Sep10

Sep11

Dec12

Asset Turnover

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0.29

0.75

0.64

0.73

0.63

Lonrho Semi-Annual Data
	Mar02	Sep02	Mar03	Sep03	Mar05	Sep05	Mar06	Sep06	Mar07	Sep07	Mar08	Sep08	Mar09	Sep09	Mar10	Sep10	Mar11	Sep11	Jun12	Dec12
Asset Turnover	Get a 7-Day Free Trial															0.33	0.27	0.29	0.37	0.25

Competitive Comparison of Lonrho's Asset Turnover

For the Conglomerates subindustry, Lonrho's Asset Turnover, along with its competitors' market caps and Asset Turnover 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.

Lonrho's Asset Turnover Distribution in the Conglomerates Industry

For the Conglomerates industry and Industrials sector, Lonrho's Asset Turnover distribution charts can be found below:

* The bar in red indicates where Lonrho's Asset Turnover falls into.

Lonrho Asset Turnover Calculation

Asset Turnover measures how quickly a company turns over its asset through sales.

Lonrho's Asset Turnover for the fiscal year that ended in Dec. 2012 is calculated as

	Asset Turnover
=	Revenue	/	Average Total Assets
=	Revenue (A: Dec. 2012 )	/	( (Total Assets (A: Sep. 2011 )	+	Total Assets (A: Dec. 2012 ))	/ count )
=	206.5	/	( (0	+	328.5)	/ 1 )
=	206.5	/	328.5
=	0.63

Lonrho's Asset Turnover for the quarter that ended in Dec. 2012 is calculated as

	Asset Turnover
=	Revenue	/	Average Total Assets
=	Revenue (Q: Dec. 2012 )	/	( (Total Assets (Q: Jun. 2012 )	+	Total Assets (Q: Dec. 2012 ))	/ count )
=	83.6	/	( (352.5	+	328.5)	/ 2 )
=	83.6	/	340.5
=	0.25

Companies with low profit margins tend to have high Asset Turnover, while those with high profit margins have low Asset Turnover. Companies in the retail industry tend to have a very high turnover ratio.

Lonrho (LSE:LONR) Asset Turnover Explanation

Asset Turnover is linked to ROE % through Du Pont Formula.

Lonrho's annulized ROE % for the quarter that ended in Dec. 2012 is

	ROE %^**		(Q: Dec. 2012 )
=	Net Income	/	Total Stockholders Equity
=	-54.8	/	167.05
=	(Net Income / Revenue)	*	(Revenue / Total Assets)	*	(Total Assets / Total Stockholders Equity)
=	(-54.8 / 167.2)	*	(167.2 / 340.5)	*	(340.5/ 167.05)
=	Net Margin %	*	Asset Turnover	*	Equity Multiplier
=	-32.78 %	*	0.491	*	2.0383
=	ROA %	*	Equity Multiplier
=	-16.09 %	*	2.0383
=	-32.80 %

Note: The Net Income data used here is two times the semi-annual (Dec. 2012) net income data. The Revenue data used here is two times the semi-annual (Dec. 2012) revenue data.

^** The ROE % used above is for Du Pont Analysis only. It is different from the defined ROE % page on our website, as here it uses Net Income instead of Net Income attributable to Common Stockholders in the calculation.

It is also linked to ROA % through Du Pont Formula:

Lonrho's annulized ROA % for the quarter that ended in Dec. 2012 is

	ROA %		(Q: Dec. 2012 )
=	Net Income	/	Total Assets
=	-54.8	/	340.5
=	(Net Income / Revenue)	*	(Revenue / Total Assets)
=	(-54.8 / 167.2)	*	(167.2 / 340.5)
=	Net Margin %	*	Asset Turnover
=	-32.78 %	*	0.491
=	-16.09 %

Note: The Net Income data used here is two times the semi-annual (Dec. 2012) net income data. The Revenue data used here is two times the semi-annual (Dec. 2012) revenue data.

Be Aware

In the article Joining The Dark Side: Pirates, Spies and Short Sellers, James Montier reported that In their US sample covering the period 1968-2003, Cooper et al find that firms with low asset growth outperformed firms with high asset growth by an astounding 20% p.a. equally weighted. Even when controlling for market, size and style, low asset growth firms outperformed high asset growth firms by 13% p.a. Therefore a company with fast asset growth may underperform.

Therefore, it is a good sign if a company's Asset Turnover is consistent or even increases. If a company's asset grows faster than sales, its Asset Turnover will decline, which can be a warning sign.

Lonrho Asset Turnover Related Terms

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Lonrho (LSE:LONR) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Conglomerates » Lonrho PLC (LSE:LONR) » Definitions » Asset Turnover

Traded in Other Exchanges

N/A

Address

Level 2, 25 Berkeley Square, London, GBR, W1J 6HB

Website

http://www.lonrho.com

Lonrho PLC is engaged in providing the infrastructure and services required for the growing oil, mineral and agricultural sectors in Africa. The Company has a diverse portfolio of investments across Sub-Saharan Africa in four core operating sectors: Agribusiness, Infrastructure, Hotels and Support Services. Agribusiness vertically integrates the production, sourcing, logistics, processing and distribution of agricultural products from Sub-Saharan Africa to the consumer. The division supplies to its retailers in Sub-Saharan Africa, Europe, the USA, Middle East, Scandinavia and the Far East. The division also distributes agricultural and heavy machinery. Infrastructure division develops and manages oil logistics terminals. Luba Freeport, the oil service terminal in the Gulf of Guinea, has attracted oil service companies to be long term tenants at the port to service oï¬€shore exploration and production rigs. The Company's Hotel division includes hotels centred on the commercial, conference and business related markets across the Continent. It owns or manages hotels in Lubumbashi and Kinshasa in the Democratic Republic of the Congo, Maputo in Mozambique, Gaborone in Botswana and Mutare in Zimbabwe. IT business is a full systems integrator and manager that designs, builds, develops and integrates IT solutions for large corporate clients, banks and governments and then undertakes management contracts to run and manage installations. The IT division is a distributor for Cisco, Microsoft, Dell and Hewlett Packard systems and equipment.

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