Buka Investments (JSE:BKI) ROIC % : -439.07% (As of Aug. 2023)

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What is Buka Investments 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 %. Buka Investments's annualized return on invested capital (ROIC %) for the quarter that ended in Aug. 2023 was -439.07%.

As of today (2024-05-30), Buka Investments's WACC % is 8.79%. Buka Investments's ROIC % is -158.78% (calculated using TTM income statement data). Buka Investments earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Buka Investments ROIC % Historical Data

The historical data trend for Buka Investments'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.

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Buka Investments ROIC % Chart

Buka Investments Annual Data

Trend

Feb14

Feb15

Feb16

Feb17

Feb18

Feb19

Feb20

Feb21

Feb22

Feb23

ROIC %

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-2.45

-2.64

-3.64

-105.24

Buka Investments Semi-Annual Data
	Feb14	Aug14	Feb15	Aug15	Feb16	Aug16	Feb17	Aug17	Feb18	Aug18	Feb19	Aug19	Feb20	Aug20	Feb21	Aug21	Feb22	Aug22	Feb23	Aug23
ROIC %	Get a 7-Day Free Trial															-	-7.40	-47.08	-604.90	-439.07

Competitive Comparison of Buka Investments's ROIC %

For the Household & Personal Products subindustry, Buka Investments'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.

Buka Investments's ROIC % Distribution in the Consumer Packaged Goods Industry

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

* The bar in red indicates where Buka Investments's ROIC % falls into.

Buka Investments ROIC % Calculation

Buka Investments's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Feb. 2023 is calculated as:

	ROIC % (A: Feb. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Feb. 2022 )	+	Invested Capital (A: Feb. 2023 ))	/ count )
=	-3.124 * ( 1 - -32.33% )	/	( (7.078	+	0.778)	/ 2 )
=	-4.1339892	/	3.928
=	-105.24 %

where

	Invested Capital		(A: Feb. 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	))
=	7.079	-	0	-	( 0.001	-	max(0, 0.525	-	6.131	+	0.001	))
=	7.078

	Invested Capital		(A: Feb. 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	))
=	3.521	-	0.066	-	( 3.273	-	max(0, 0.844	-	3.521	+	3.273	))
=	0.778

Buka Investments's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Aug. 2023 is calculated as:

	ROIC % (Q: Aug. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Feb. 2023 )	+	Invested Capital (Q: Aug. 2023 ))	/ count )
=	-3.416 * ( 1 - 0% )	/	( (0.778	+	0)	/ 2 )
=	-3.416	/	0.389
=	-878.15 %

where

	Invested Capital		(Q: Feb. 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	))
=	3.521	-	0.066	-	( 3.273	-	max(0, 0.844	-	3.521	+	3.273	))
=	0.778

	Invested Capital		(Q: Aug. 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	))
=	1.865	-	0.812	-	( 1.407	-	max(0, 0.812	-	1.865	+	1.407	))
=	0

Note: The Operating Income data used here is two times the semi-annual (Aug. 2023) data.

Buka Investments (JSE:BKI) 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, Buka Investments's WACC % is 8.79%. Buka Investments's ROIC % is -158.78% (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.

Buka Investments ROIC % Related Terms

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Buka Investments (JSE:BKI) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Consumer Packaged Goods » Buka Investments Ltd (JSE:BKI) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

23 Saddle Drive, Woodmead Office Park, Woodmead, Johannesburg, GT, ZAF, 2191

Website

https://www.bukainvestments.com

Buka Investments Ltd is a beauty and wellness solutions group. The company's own skin care product brands are Placecol and Skinderm. The company has its own franchise salon footprint through the following franchise salon chains: Placecol Skin Care Clinics, Perfect 10, and Dream Nails Beauty Salons. The group's skincare brands are available to customers in its own salon footprint, large retail groups, pharmacies, various independent salon outlets, and on various online platforms.