Altri SGPS (XLIS:ALTR) ROC % : 6.54% (As of Dec. 2023)

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What is Altri SGPS 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 %. Altri SGPS's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was 6.54%.

As of today (2024-04-28), Altri SGPS's WACC % is 6.65%. Altri SGPS's ROC % is 2.09% (calculated using TTM income statement data). Altri SGPS earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Altri SGPS ROC % Historical Data

The historical data trend for Altri SGPS'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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Altri SGPS ROC % Chart

Altri SGPS Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

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9.69

4.69

8.31

12.29

4.71

Altri SGPS Quarterly Data
	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Jun23	Sep23	Dec23
ROC %	Get a 7-Day Free Trial															19.17	17.75	4.29	-	6.54

Altri SGPS ROC % Calculation

Altri SGPS's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	55.045 * ( 1 - 10.55% )	/	( (1107.429	+	985.342)	/ 2 )
=	49.2377525	/	1046.3855
=	4.71 %

where

	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	))
=	1498.363	-	157.327	-	( 233.607	-	max(0, 315.293	-	694.631	+	233.607	))
=	1107.429

	Invested Capital		(A: 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	))
=	1314.95	-	101.217	-	( 253.703	-	max(0, 276.501	-	504.892	+	253.703	))
=	985.342

Altri SGPS's annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	84.82 * ( 1 - 22.5% )	/	( (1024.285	+	985.342)	/ 2 )
=	65.7355	/	1004.8135
=	6.54 %

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	))
=	1269.476	-	91.797	-	( 209.007	-	max(0, 304.795	-	458.189	+	209.007	))
=	1024.285

	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	))
=	1314.95	-	101.217	-	( 253.703	-	max(0, 276.501	-	504.892	+	253.703	))
=	985.342

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

Altri SGPS (XLIS:ALTR) 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, Altri SGPS's WACC % is 6.65%. Altri SGPS's ROC % is 2.09% (calculated using TTM income statement data). Altri SGPS 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.

Altri SGPS ROC % Related Terms

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Altri SGPS (XLIS:ALTR) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Forest Products » Altri SGPS SA (XLIS:ALTR) » Definitions » ROC %

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Address

Rua Manuel Pinto de Azevedo, 818, Porto, PRT, 4100-320

Website

https://www.altri.pt

Altri SGPS SA manages forests and produces and sells pulp. The company owns and manages eucalyptus forests throughout Portugal and harvests timber. The timber is transported to the firm's mills, where it produces pulp for sale to paper manufacturers. Around half of the company's pulp is sold to tissue paper producers, while other main end products include writing and printing paper, and soluble paste, which is used in the production of textiles. It also generates and sells electricity from biomass. The majority of revenue comes from Europe.