ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Harland & Wolff Group Holdings's annualized return on invested capital (ROIC %) for the quarter that ended in Jun. 2023 was -25.11%.
As of today (2024-05-20), Harland & Wolff Group Holdings's WACC % is 29.87%. Harland & Wolff Group Holdings's ROIC % is -52.98% (calculated using TTM income statement data).
Harland & Wolff Group Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.
Harland & Wolff Group Holdings ROIC % Historical 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.
Competitive Comparison of Harland & Wolff Group Holdings's ROIC %
For the Aerospace & Defense subindustry, Harland & Wolff Group Holdings'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.
Harland & Wolff Group Holdings's ROIC % Distribution in the Aerospace & Defense Industry
For the Aerospace & Defense industry and Industrials sector, Harland & Wolff Group Holdings's ROIC % distribution charts can be found below:
* The bar in red indicates where Harland & Wolff Group Holdings's ROIC % falls into.
Harland & Wolff Group Holdings ROIC % Calculation
Harland & Wolff Group Holdings's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Dec. 2022 is calculated as:
Note:
The Operating Income data used here is two times the semi-annual (Jun. 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.
Harland & Wolff Group Holdings (LSE:HARL) 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, Harland & Wolff Group Holdings's WACC % is 29.87%. Harland & Wolff Group Holdings's ROIC % is -52.98% (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.
Harland & Wolff Group Holdings ROIC % Related Terms
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Harland & Wolff Group Holdings (LSE:HARL) Business Description
Harland & Wolff Group Holdings PLC is a multisite fabrication company, operating in the maritime and offshore industry through markets such as commercial, cruise and ferry, and renewables and six services namely technical services, fabrication and construction, decommissioning, repair and maintenance, in-service support and conversion. The Comapny is organised into 6 segments: Cruise & Ferry, Commercial, Energy, Defence, Renewables and other being Head Office related. The Company generates revenue from multiple streams including shipbuilding, engineering (e.g. fabrication of wind turbines) and ship repairs and maintenance.
Harland & Wolff Group Holdings (LSE:HARL) Headlines
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