Nickel 28 Capital (TSXV:NKL) ROC % : -4.95% (As of Oct. 2023)

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What is Nickel 28 Capital 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 %. Nickel 28 Capital's annualized return on capital (ROC %) for the quarter that ended in Oct. 2023 was -4.95%.

As of today (2024-06-07), Nickel 28 Capital's WACC % is 4.89%. Nickel 28 Capital's ROC % is -7.98% (calculated using TTM income statement data). Nickel 28 Capital earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Nickel 28 Capital ROC % Historical Data

The historical data trend for Nickel 28 Capital'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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Nickel 28 Capital ROC % Chart

Nickel 28 Capital Annual Data

Trend

Dec19

Dec20

Jan22

Jan23

ROC %

-2.13

-4.39

-2.79

Nickel 28 Capital Quarterly Data
	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Jan22	Apr22	Jul22	Oct22	Jan23	Apr23	Jul23	Oct23
ROC %	Get a 7-Day Free Trial											-3.40	-9.81	-8.05	-8.98	-4.95

Nickel 28 Capital ROC % Calculation

Nickel 28 Capital's annualized Return on Capital (ROC %) for the fiscal year that ended in Jan. 2023 is calculated as:

	ROC % (A: Jan. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Jan. 2022 )	+	Invested Capital (A: Jan. 2023 ))	/ count )
=	-10.837 * ( 1 - 44.86% )	/	( (208.555	+	219.674)	/ 2 )
=	-5.9755218	/	214.1145
=	-2.79 %

where

	Invested Capital		(A: Jan. 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	))
=	202.112	-	0.403	-	( 5.145	-	max(0, 16.667	-	9.821	+	5.145	))
=	208.555

	Invested Capital		(A: Jan. 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	))
=	207.665	-	0.452	-	( 3.209	-	max(0, 29.072	-	16.611	+	3.209	))
=	219.674

Nickel 28 Capital's annualized Return on Capital (ROC %) for the quarter that ended in Oct. 2023 is calculated as:

	ROC % (Q: Oct. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jul. 2023 )	+	Invested Capital (Q: Oct. 2023 ))	/ count )
=	-10.86 * ( 1 - 0% )	/	( (228.922	+	209.843)	/ 2 )
=	-10.86	/	219.3825
=	-4.95 %

where

	Invested Capital		(Q: Jul. 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	))
=	210.167	-	0.645	-	( 8.586	-	max(0, 28.813	-	9.413	+	8.586	))
=	228.922

	Invested Capital		(Q: Oct. 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	))
=	208.876	-	0.251	-	( 13.509	-	max(0, 15.444	-	14.226	+	13.509	))
=	209.843

Note: The Operating Income data used here is four times the quarterly (Oct. 2023) data.

Nickel 28 Capital (TSXV:NKL) 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, Nickel 28 Capital's WACC % is 4.89%. Nickel 28 Capital's ROC % is -7.98% (calculated using TTM income statement data). Nickel 28 Capital 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.

Nickel 28 Capital ROC % Related Terms

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Nickel 28 Capital (TSXV:NKL) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Metals & Mining » Nickel 28 Capital Corp (TSXV:NKL) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

CONXF:USA 3JC:Germany

Address

155 University Avenue, Suite 1240, Toronto, ON, CAN, M5H 3B7

Website

https://www.nickel28.com

Nickel 28 Capital Corp is a nickel-cobalt producer in Canada. Nickel-cobalt production comes from its joint-venture interest in the Ramu Nickel-Cobalt Operation located in Papua New Guinea provides it with significant attributable nickel and cobalt production thereby offering shareholders direct exposure to two metals that are critical to the adoption of electric vehicles. In addition, the company manages a portfolio of around 13 nickel and cobalt royalties on development and exploration projects in Canada, Australia, and Papua New Guinea.

Executives

Edward A. Collery	Director, Director or Senior Officer of 10% Security Holder
Pelham Investment Partners	10% Security Holder

Nickel 28 Capital (TSXV:NKL) Headlines

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