Pochin′s (LSE:PCH) ROCE % : 14.06% (As of Nov. 2013)

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What is Pochin′s ROCE %?

ROCE % measures how well a company generates profits from its capital. It is calculated as EBIT divided by Capital Employed, where Capital Employed is calculated as Total Assets minus Total Current Liabilities. Pochin′s's annualized ROCE % for the quarter that ended in Nov. 2013 was 14.06%.

Pochin′s ROCE % Historical Data

The historical data trend for Pochin′s's ROCE % 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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Pochin′s ROCE % Chart

Pochin′s Annual Data

Trend

May04

May05

May06

May07

May08

May09

May10

May11

May12

May13

ROCE %

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-15.15

-33.64

5.85

-0.38

-25.68

Pochin′s Semi-Annual Data
	May04	Nov04	May05	Nov05	May06	Nov06	May07	Nov07	May08	Nov08	May09	Nov09	May10	Nov10	May11	Nov11	May12	Nov12	May13	Nov13
ROCE %	Get a 7-Day Free Trial															12.63	-13.61	5.74	-40.99	14.06

Pochin′s ROCE % Calculation

Pochin′s's annualized ROCE % for the fiscal year that ended in May. 2013 is calculated as:

ROCE %	=	EBIT	/	( (Capital Employed	+	Capital Employed)	/ count )
		(A: May. 2013 )		(A: May. 2012 )		(A: May. 2013 )
	=	EBIT	/	( ( (Total Assets - Total Current Liabilities)	+	(Total Assets - Total Current Liabilities) )	/ count )
		(A: May. 2013 )		(A: May. 2012 )		(A: May. 2013 )
	=	-5.83	/	( ( (77.006 - 50.548)	+	(65.224 - 46.272) )	/ 2 )
	=	-5.83	/	( (26.458	+	18.952)	/ 2 )
	=	-5.83	/	22.705
	=	-25.68 %

Pochin′s's ROCE % of for the quarter that ended in Nov. 2013 is calculated as:

ROCE %	=	EBIT ⁽¹⁾	/	( (Capital Employed	+	Capital Employed)	/ count )
		(Q: Nov. 2013 )		(Q: May. 2013 )		(Q: Nov. 2013 )
	=	EBIT	/	( ( (Total Assets - Total Current Liabilities)	+	(Total Assets - Total Current Liabilities) )	/ count )
		(Q: Nov. 2013 )		(Q: May. 2013 )		(Q: Nov. 2013 )
	=	2.598	/	( ( (65.224 - 46.272)	+	(65.296 - 47.29) )	/ 2 )
	=	2.598	/	( ( 18.952	+	18.006 )	/ 2 )
	=	2.598	/	18.479
	=	14.06 %

(1) Note: The EBIT data used here is two times the semi-annual (Nov. 2013) EBIT data.

Pochin′s (LSE:PCH) ROCE % Explanation

ROCE % can be especially useful when comparing the performance of capital-intensive companies. Unlike ROE %, which indicates the profitability of Shareholders Equity, ROCE % also considers long-term debt in Capital Employed. This can be helpful when analyzing companies with significant debt, as the result is neutralized by taking debt into consideration.

Generally speaking, a higher ROCE % indicates a stonger profitability for a company. Moreover, it is important to look at the ratio from a long term perspective. Investors tend to favor companies with stable and rising ROCE % trend over those with volatile ones.

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Pochin′s (LSE:PCH) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Construction » Pochin′s PLC (LSE:PCH) » Definitions » ROCE %

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Address

Website

http://www.pochins.plc.uk

Pochin's PLC is a construction and development Company. The Company is engaged in building, civil engineering contracting and house building, property development and letting. Its segments are Construction and Property development & investment. The group operates within the United Kingdom.