Roma Green Finance (Roma Green Finance) ROC % : -52.63% (As of Mar. 2023)

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What is Roma Green Finance 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 %. Roma Green Finance's annualized return on capital (ROC %) for the quarter that ended in Mar. 2023 was -52.63%.

As of today (2024-04-26), Roma Green Finance's WACC % is 10.65%. Roma Green Finance's ROC % is -72.82% (calculated using TTM income statement data). Roma Green Finance earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Roma Green Finance ROC % Historical Data

The historical data trend for Roma Green Finance'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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Roma Green Finance ROC % Chart

Roma Green Finance Annual Data

Trend

Mar21

Mar22

Mar23

ROC %

-1.80

-72.49

-63.78

Roma Green Finance Semi-Annual Data
	Mar21	Sep21	Mar22	Sep22	Mar23
ROC %	-	-291.02	98.58	-101.80	-52.63

Roma Green Finance ROC % Calculation

Roma Green Finance's annualized Return on Capital (ROC %) for the fiscal year that ended in Mar. 2023 is calculated as:

	ROC % (A: Mar. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Mar. 2022 )	+	Invested Capital (A: Mar. 2023 ))	/ count )
=	-0.125 * ( 1 - 0% )	/	( (0.211	+	0.181)	/ 2 )
=	-0.125	/	0.196
=	-63.78 %

where

	Invested Capital		(A: Mar. 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	))
=	0.53	-	0.428	-	( 0.054	-	max(0, 0.627	-	0.518	+	0.054	))
=	0.211

	Invested Capital		(A: Mar. 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	))
=	0.717	-	0.604	-	( 0.068	-	max(0, 0.776	-	0.708	+	0.068	))
=	0.181

Roma Green Finance's annualized Return on Capital (ROC %) for the quarter that ended in Mar. 2023 is calculated as:

	ROC % (Q: Mar. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2022 )	+	Invested Capital (Q: Mar. 2023 ))	/ count )
=	-0.08 * ( 1 - 0% )	/	( (0.123	+	0.181)	/ 2 )
=	-0.08	/	0.152
=	-52.63 %

where

	Invested Capital		(Q: Sep. 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	))
=	0.384	-	0.457	-	( 0.056	-	max(0, 0.569	-	0.373	+	0.056	))
=	0.123

	Invested Capital		(Q: Mar. 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	))
=	0.717	-	0.604	-	( 0.068	-	max(0, 0.776	-	0.708	+	0.068	))
=	0.181

Note: The Operating Income data used here is two times the semi-annual (Mar. 2023) data.

Roma Green Finance (NAS:ROMA) 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, Roma Green Finance's WACC % is 10.65%. Roma Green Finance's ROC % is -72.82% (calculated using TTM income statement data). Roma Green Finance 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.

Roma Green Finance ROC % Related Terms

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Roma Green Finance (Roma Green Finance) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Business Services » Roma Green Finance Ltd (NAS:ROMA) » Definitions » ROC %

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Traded in Other Exchanges

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Address

8 Fleming Road, Flat 605, 6 Floor, Tai Tung Building, Wanchai, Hong Kong, HKG

Website

http://www.romaesg.com

Roma Green Finance Ltd is principally engaged in the provision of ESG, corporate governance and risk management as well as sustainability and climate change-related advisory services. The company works closely with its clients to help them understand, identify, manage and overcome various business matters arising from such factors related to ESG, sustainability and climate change. it provides tailored-made sustainability solutions to meet the client's specific needs. Its mission is to provide its clients with a one-stop destination for high-quality and holistic sustainability and climate change-related consulting services to support a more sustainable, balanced and inclusive future for our clients' organizations and the world.

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