ATW Tech (TSXV:ATW) ROC % : -66.47% (As of Sep. 2023)

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What is ATW Tech 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 %. ATW Tech's annualized return on capital (ROC %) for the quarter that ended in Sep. 2023 was -66.47%.

As of today (2024-06-08), ATW Tech's WACC % is 3.63%. ATW Tech's ROC % is -63.15% (calculated using TTM income statement data). ATW Tech earns returns that do not match up to its cost of capital. It will destroy value as it grows.

ATW Tech ROC % Historical Data

The historical data trend for ATW Tech'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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ATW Tech ROC % Chart

ATW Tech Annual Data

Trend

Dec13

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

ROC %

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-8.61

-63.32

-35.45

-65.30

-108.45

ATW Tech Quarterly Data
	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23
ROC %	Get a 7-Day Free Trial															-83.57	-90.11	-46.49	-76.94	-66.47

ATW Tech ROC % Calculation

ATW Tech's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2022 is calculated as:

	ROC % (A: Dec. 2022 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2021 )	+	Invested Capital (A: Dec. 2022 ))	/ count )
=	-2.079 * ( 1 - 0% )	/	( (1.527	+	2.307)	/ 2 )
=	-2.079	/	1.917
=	-108.45 %

where

	Invested Capital		(A: Dec. 2021 )
=	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	))
=	1.891	-	1.234	-	( 0.24	-	max(0, 1.53	-	0.66	+	0.24	))
=	1.527

	Invested Capital		(A: Dec. 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	))
=	1.369	-	1.387	-	( 0.022	-	max(0, 2.648	-	0.323	+	0.022	))
=	2.307

ATW Tech's annualized Return on Capital (ROC %) for the quarter that ended in Sep. 2023 is calculated as:

	ROC % (Q: Sep. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2023 )	+	Invested Capital (Q: Sep. 2023 ))	/ count )
=	-2.968 * ( 1 - 0% )	/	( (2.603	+	6.328)	/ 2 )
=	-2.968	/	4.4655
=	-66.47 %

where

	Invested Capital		(Q: Jun. 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	))
=	1.637	-	1.348	-	( 0.088	-	max(0, 3.023	-	0.709	+	0.088	))
=	2.603

	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	))
=	4.564	-	1.179	-	( 0.083	-	max(0, 3.689	-	0.746	+	0.083	))
=	6.328

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

ATW Tech (TSXV:ATW) 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, ATW Tech's WACC % is 3.63%. ATW Tech's ROC % is -63.15% (calculated using TTM income statement data). ATW Tech 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.

ATW Tech ROC % Related Terms

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ATW Tech (TSXV:ATW) Business Description

Industry

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Address

1050 de la Montagne Street, Suite 400, Montreal, QC, CAN, H3G 1Y8

Website

https://www.atwtech.com

ATW Tech Inc is a financial technology company owning several web platforms including VoxTel, VuduMobile, Option.vote and Bloomed. The Communication segment offers various interactive communication and payment solutions, including carrier billing. Its Psychometric assessment segment offered assistance to businesses and mass markets in talent optimization and human capital development. Geographic segments include Canada, the United States, Europe, and other countries of which Europe region generates maximum revenue.

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