Linc Energy (ASX:LNC) ROIC % : -19.76% (As of Dec. 2015)

View and export this data going back to . Start your Free Trial

What is Linc Energy 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 %. Linc Energy's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2015 was -19.76%.

As of today (2024-05-11), Linc Energy's WACC % is 0.00%. Linc Energy's ROIC % is -12.99% (calculated using TTM income statement data). Linc Energy earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Linc Energy ROIC % Historical Data

The historical data trend for Linc Energy'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.

* Premium members only.

Linc Energy ROIC % Chart

Linc Energy Annual Data

Trend

Jun06

Jun07

Jun08

Jun09

Jun10

Jun11

Jun12

Jun13

Jun14

Jun15

ROIC %

Get a 7-Day Free Trial

-24.14

-9.94

-5.44

-11.56

-14.64

Linc Energy Quarterly Data
	Jun06	Jun07	Jun08	Jun09	Jun10	Jun11	Jun12	Dec12	Mar13	Jun13	Sep13	Dec13	Mar14	Jun14	Sep14	Dec14	Mar15	Jun15	Sep15	Dec15
ROIC %	Get a 7-Day Free Trial															-12.15	-17.44	-40.94	-11.82	-19.76

Competitive Comparison of Linc Energy's ROIC %

For the Oil & Gas E&P subindustry, Linc Energy'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.

Linc Energy's ROIC % Distribution in the Oil & Gas Industry

For the Oil & Gas industry and Energy sector, Linc Energy's ROIC % distribution charts can be found below:

* The bar in red indicates where Linc Energy's ROIC % falls into.

Linc Energy ROIC % Calculation

Linc Energy's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Jun. 2015 is calculated as:

	ROIC % (A: Jun. 2015 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Jun. 2014 )	+	Invested Capital (A: Jun. 2015 ))	/ count )
=	-148.082 * ( 1 - 0.91% )	/	( (1077.284	+	927.862)	/ 2 )
=	-146.7344538	/	1002.573
=	-14.64 %

where

	Invested Capital		(A: Jun. 2014 )
=	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	))
=	942.971	-	62.131	-	( 57.974	-	max(0, 277.996	-	81.552	+	57.974	))
=	1077.284

	Invested Capital		(A: Jun. 2015 )
=	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	))
=	811.309	-	39.4	-	( 52.164	-	max(0, 225.888	-	69.935	+	52.164	))
=	927.862

Linc Energy's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Dec. 2015 is calculated as:

	ROIC % (Q: Dec. 2015 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2015 )	+	Invested Capital (Q: Dec. 2015 ))	/ count )
=	-181.508 * ( 1 - -2.01% )	/	( (982.829	+	890.947)	/ 2 )
=	-185.1563108	/	936.888
=	-19.76 %

where

	Invested Capital		(Q: Sep. 2015 )
=	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	))
=	840.991	-	61.94	-	( 50.068	-	max(0, 273.784	-	70.006	+	50.068	))
=	982.829

	Invested Capital		(Q: Dec. 2015 )
=	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	))
=	713.479	-	41.825	-	( 11.109	-	max(0, 243.635	-	24.342	+	11.109	))
=	890.947

Note: The Operating Income data used here is four times the quarterly (Dec. 2015) data.

Linc Energy (ASX:LNC) 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, Linc Energy's WACC % is 0.00%. Linc Energy's ROIC % is -12.99% (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.

Linc Energy ROIC % Related Terms

Thank you for viewing the detailed overview of Linc Energy's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.

Linc Energy (ASX:LNC) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Energy » Oil & Gas » Linc Energy Ltd. (ASX:LNC) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

32 Edward Street, Smellie & Company Building, Brisbane, QLD, AUS, 4000

Website

http://www.lincenergy.com

Linc Energy Ltd engages in exploration, development, and production of conventional oil and gas and unconventional syngas through the utilization of its underground coal gasification technology. The company's gulf coast properties are spread across Texas and Louisiana and include various producing wells over active fields, both onshore and in shallow state waters. Its segments consist of Oil and Gas engaged in exploration, development, and production of traditional oil and gas assets in North America; Clean Energy engaged in development and commercialization of Coal-to-Liquids processes through the combined utilization of Underground Coal Gasification and Gas to Liquids technologies; and Shale oil engaged in exploration of the company's petroleum exploration tenements in South Australia.