Golden Heaven Group Holdings (Golden Heaven Group Holdings) ROC % : -1.90% (As of Sep. 2023)

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What is Golden Heaven Group Holdings 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 %. Golden Heaven Group Holdings's annualized return on capital (ROC %) for the quarter that ended in Sep. 2023 was -1.90%.

As of today (2024-05-23), Golden Heaven Group Holdings's WACC % is 6.95%. Golden Heaven Group Holdings's ROC % is 10.24% (calculated using TTM income statement data). Golden Heaven Group Holdings generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.

Golden Heaven Group Holdings ROC % Historical Data

The historical data trend for Golden Heaven Group Holdings'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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Golden Heaven Group Holdings ROC % Chart

Golden Heaven Group Holdings Annual Data

Trend

Sep20

Sep21

Sep22

Sep23

ROC %

12.62

21.79

23.27

9.83

Golden Heaven Group Holdings Semi-Annual Data
	Sep20	Mar21	Sep21	Mar22	Sep22	Mar23	Sep23
ROC %	Get a 7-Day Free Trial			16.09	24.54	24.82	25.47	-1.90

Golden Heaven Group Holdings ROC % Calculation

Golden Heaven Group Holdings's annualized Return on Capital (ROC %) for the fiscal year that ended in Sep. 2023 is calculated as:

	ROC % (A: Sep. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Sep. 2022 )	+	Invested Capital (A: Sep. 2023 ))	/ count )
=	10.725 * ( 1 - 39.3% )	/	( (58.812	+	73.708)	/ 2 )
=	6.510075	/	66.26
=	9.83 %

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	))
=	73.085	-	5.856	-	( 22.447	-	max(0, 16.07	-	24.487	+	22.447	))
=	58.812

	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	))
=	82.227	-	8.309	-	( 0.246	-	max(0, 14.527	-	14.737	+	0.246	))
=	73.708

Golden Heaven Group Holdings'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: Mar. 2023 )	+	Invested Capital (Q: Sep. 2023 ))	/ count )
=	0.586 * ( 1 - 313.83% )	/	( (58.166	+	73.708)	/ 2 )
=	-1.2530438	/	65.937
=	-1.90 %

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	))
=	80.649	-	5.839	-	( 28.263	-	max(0, 15.57	-	32.214	+	28.263	))
=	58.166

	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	))
=	82.227	-	8.309	-	( 0.246	-	max(0, 14.527	-	14.737	+	0.246	))
=	73.708

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

Golden Heaven Group Holdings (NAS:GDHG) 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, Golden Heaven Group Holdings's WACC % is 6.95%. Golden Heaven Group Holdings's ROC % is 10.24% (calculated using TTM income statement data). Golden Heaven Group Holdings generates higher returns on investment than it costs the company to raise the capital needed for that investment. It 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.

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.

Golden Heaven Group Holdings ROC % Related Terms

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Golden Heaven Group Holdings (Golden Heaven Group Holdings) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Travel & Leisure » Golden Heaven Group Holdings Ltd (NAS:GDHG) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

No. 8 Banhouhaichuan Road, Xiqin Town, Yanping District, Fujian Province, Nanping City, CHN, 353001

Website

http://www.jsyoule.com

Golden Heaven Group Holdings Ltd is an offshore holding company. Through the operating entities in China, It manages and operates six properties consisting of amusement parks, water parks, and complementary recreational facilities. The parks offer a broad selection of exhilarating and recreational experiences, including both thrilling and family-friendly rides, water attractions, gourmet festivals, circus performances, and high-tech facilities. The parks collectively contain nearly 159 rides and attractions. The firm's revenue is primarily generated from selling access to rides and attractions, charging fees for special event rentals, and collecting regular rental payments from commercial tenants.