Qilian International Holding Group (Qilian International Holding Group) ROIC % : -14.84% (As of Sep. 2023)

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What is Qilian International Holding Group 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 %. Qilian International Holding Group's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2023 was -14.84%.

As of today (2024-04-30), Qilian International Holding Group's WACC % is 13.74%. Qilian International Holding Group's ROIC % is -6.39% (calculated using TTM income statement data). Qilian International Holding Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Qilian International Holding Group ROIC % Historical Data

The historical data trend for Qilian International Holding Group'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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Qilian International Holding Group ROIC % Chart

Qilian International Holding Group Annual Data

Trend

Sep17

Sep18

Sep19

Sep20

Sep21

Sep22

Sep23

ROIC %

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24.43

18.09

6.29

4.37

-7.39

Qilian International Holding Group Semi-Annual Data
	Sep17	Mar18	Sep18	Mar19	Sep19	Mar20	Sep20	Mar21	Sep21	Mar22	Sep22	Mar23	Sep23
ROIC %	Get a 7-Day Free Trial								3.23	2.89	4.35	0.85	-14.84

Competitive Comparison of Qilian International Holding Group's ROIC %

For the Drug Manufacturers - Specialty & Generic subindustry, Qilian International Holding Group'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.

Qilian International Holding Group's ROIC % Distribution in the Drug Manufacturers Industry

For the Drug Manufacturers industry and Healthcare sector, Qilian International Holding Group's ROIC % distribution charts can be found below:

* The bar in red indicates where Qilian International Holding Group's ROIC % falls into.

Qilian International Holding Group ROIC % Calculation

Qilian International Holding Group's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Sep. 2023 is calculated as:

	ROIC % (A: Sep. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Sep. 2022 )	+	Invested Capital (A: Sep. 2023 ))	/ count )
=	-2.418 * ( 1 - -2.77% )	/	( (43.401	+	23.837)	/ 2 )
=	-2.4849786	/	33.619
=	-7.39 %

where

	Invested Capital		(A: Sep. 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	))
=	64.527	-	6.807	-	( 14.319	-	max(0, 9.181	-	30.034	+	14.319	))
=	43.401

	Invested Capital		(A: 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	))
=	51.258	-	5.002	-	( 22.419	-	max(0, 6.66	-	34.513	+	22.419	))
=	23.837

Qilian International Holding Group's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Sep. 2023 is calculated as:

	ROIC % (Q: Sep. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Mar. 2023 )	+	Invested Capital (Q: Sep. 2023 ))	/ count )
=	-5.45 * ( 1 - 0.34% )	/	( (49.361	+	23.837)	/ 2 )
=	-5.43147	/	36.599
=	-14.84 %

where

	Invested Capital		(Q: 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	))
=	64.234	-	5.993	-	( 8.88	-	max(0, 9.183	-	27.079	+	8.88	))
=	49.361

	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	))
=	51.258	-	5.002	-	( 22.419	-	max(0, 6.66	-	34.513	+	22.419	))
=	23.837

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

Qilian International Holding Group (NAS:QLI) 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, Qilian International Holding Group's WACC % is 13.74%. Qilian International Holding Group's ROIC % is -6.39% (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.

Qilian International Holding Group ROIC % Related Terms

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Qilian International Holding Group (Qilian International Holding Group) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Drug Manufacturers » Qilian International Holding Group Ltd (NAS:QLI) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

Jiuquan Economic and Technological Development Zone, Gansu Province, Jiuquan, CHN, 735000

Website

http://ir.qlsyy.net

Qilian International Holding Group Ltd is a pharmaceutical and chemical company. The company is engaged in the development, manufacture, marketing, and sale of licorice products, oxytetracycline products, traditional Chinese medicine derivatives products, heparin products, sausage casings, and fertilizers. It operates through three segments namely, Oxytetracycline and Licorice products and TCMD; Fertilizer; and Heparin products and Sausage casing. Oxytetracycline and Licorice products and TCMD segment generates majority of the revenue.