GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Consumer Packaged Goods » Ariake Japan Co Ltd (TSE:2815) » Definitions » ROIC %

Ariake Japan Co (TSE:2815) ROIC % : 9.71% (As of Dec. 2023)


View and export this data going back to 1995. Start your Free Trial

What is Ariake Japan Co 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 %. Ariake Japan Co's annualized return on invested capital (ROIC %) for the quarter that ended in Dec. 2023 was 9.71%.

As of today (2024-05-10), Ariake Japan Co's WACC % is 6.72%. Ariake Japan Co's ROIC % is 8.76% (calculated using TTM income statement data). Ariake Japan Co generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.


Ariake Japan Co ROIC % Historical Data

The historical data trend for Ariake Japan Co'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.

Ariake Japan Co ROIC % Chart

Ariake Japan Co Annual Data
Trend Mar15 Mar16 Mar17 Mar18 Mar19 Mar20 Mar21 Mar22 Mar23 Mar24
ROIC %
Get a 7-Day Free Trial Premium Member Only Premium Member Only 14.64 14.51 15.95 10.51 8.37

Ariake Japan Co Quarterly Data
Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24
ROIC % Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 10.48 8.08 6.97 9.71 8.38

Competitive Comparison of Ariake Japan Co's ROIC %

For the Packaged Foods subindustry, Ariake Japan Co'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.


Ariake Japan Co's ROIC % Distribution in the Consumer Packaged Goods Industry

For the Consumer Packaged Goods industry and Consumer Defensive sector, Ariake Japan Co's ROIC % distribution charts can be found below:

* The bar in red indicates where Ariake Japan Co's ROIC % falls into.



Ariake Japan Co ROIC % Calculation

Ariake Japan Co's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Mar. 2024 is calculated as:

ROIC % (A: Mar. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Mar. 2023 ) + Invested Capital (A: Mar. 2024 ))/ count )
=8662.73 * ( 1 - 31.04% )/( (63160.135 + 79668.255)/ 2 )
=5973.818608/71414.195
=8.37 %

where

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))
=126262.252 - 6305.284 - ( 56796.833 - max(0, 9805.712 - 81413.309+56796.833))
=63160.135

Invested Capital(A: Mar. 2024 )
=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))
=136597.269 - 6723.739 - ( 50205.275 - max(0, 10615.521 - 76161.451+50205.275))
=79668.255

Ariake Japan Co's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Dec. 2023 is calculated as:

ROIC % (Q: Dec. 2023 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Sep. 2023 ) + Invested Capital (Q: Dec. 2023 ))/ count )
=10539.18 * ( 1 - 31.43% )/( (70164.179 + 78610.32)/ 2 )
=7226.715726/74387.2495
=9.71 %

where

Invested Capital(Q: Sep. 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))
=131647.373 - 6222.924 - ( 55260.27 - max(0, 9898.47 - 82252.57+55260.27))
=70164.179

Invested Capital(Q: Dec. 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))
=135426.945 - 6196.109 - ( 50620.516 - max(0, 11407.468 - 79505.816+50620.516))
=78610.32

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

* 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.


Ariake Japan Co  (TSE:2815) 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, Ariake Japan Co's WACC % is 6.72%. Ariake Japan Co's ROIC % is 8.76% (calculated using TTM income statement data). Ariake Japan Co generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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. Ariake Japan Co 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 %, 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.


Ariake Japan Co ROIC % Related Terms

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


Ariake Japan Co (TSE:2815) Business Description

Traded in Other Exchanges
Address
3-2-17 Ebisu-Minami, Shibuya-ku, Tokyo, JPN, 150-0022
Ariake Japan Co Ltd is engaged in manufacturing, processing, and sale of natural seasonings, marine products, as well as agricultural and livestock products. The company also provides technical guidance related to its products and manages restaurants. The products are categorized into different uses including products for instant noodle manufacturers such as soup bases; products for hotels and restaurants such as sauces and soup stock; products for food processing companies such as curries, ham, and sausages; and products for export. The company primarily operates in Japan and also owns manufacturing sites in multiple countries such as China, the U.S., Netherlands, France, and Belgium.

Ariake Japan Co (TSE:2815) Headlines

No Headlines