C&D Newin Paper & Pulp (HKSE:00731) ROC % : -6.23% (As of Dec. 2023)

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What is C&D Newin Paper & Pulp 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 %. C&D Newin Paper & Pulp's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was -6.23%.

As of today (2024-06-01), C&D Newin Paper & Pulp's WACC % is 4.10%. C&D Newin Paper & Pulp's ROC % is -12.67% (calculated using TTM income statement data). C&D Newin Paper & Pulp earns returns that do not match up to its cost of capital. It will destroy value as it grows.

C&D Newin Paper & Pulp ROC % Historical Data

The historical data trend for C&D Newin Paper & Pulp'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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C&D Newin Paper & Pulp ROC % Chart

C&D Newin Paper & Pulp Annual Data

Trend

Mar14

Mar15

Mar16

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Dec23

ROC %

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2.00

0.99

-3.56

-0.15

-10.30

C&D Newin Paper & Pulp Semi-Annual Data
	Mar14	Sep14	Mar15	Sep15	Mar16	Sep16	Mar17	Sep17	Mar18	Sep18	Mar19	Sep19	Mar20	Sep20	Mar21	Sep21	Mar22	Sep22	Jun23	Dec23
ROC %	Get a 7-Day Free Trial															0.23	-0.54	-10.81	-18.72	-6.23

C&D Newin Paper & Pulp ROC % Calculation

C&D Newin Paper & Pulp'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: Mar. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	-126.491 * ( 1 - 0.56% )	/	( (1468	+	973.716)	/ 2 )
=	-125.7826504	/	1220.858
=	-10.30 %

where

	Invested Capital		(A: Mar. 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	))
=	1576.801	-	457.52	-	( 5.274	-	max(0, 829.263	-	480.544	+	5.274	))
=	1468

	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	))
=	1172.94	-	310.752	-	( 27.412	-	max(0, 367.998	-	256.47	+	27.412	))
=	973.716

C&D Newin Paper & Pulp'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: Jun. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	-63.666 * ( 1 - 2.8% )	/	( (1011.607	+	973.716)	/ 2 )
=	-61.883352	/	992.6615
=	-6.23 %

where

	Invested Capital		(Q: Jun. 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	))
=	1174.762	-	314.851	-	( 14.89	-	max(0, 399.468	-	247.772	+	14.89	))
=	1011.607

	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	))
=	1172.94	-	310.752	-	( 27.412	-	max(0, 367.998	-	256.47	+	27.412	))
=	973.716

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

C&D Newin Paper & Pulp (HKSE:00731) 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, C&D Newin Paper & Pulp's WACC % is 4.10%. C&D Newin Paper & Pulp's ROC % is -12.67% (calculated using TTM income statement data). C&D Newin Paper & Pulp 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.

C&D Newin Paper & Pulp ROC % Related Terms

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C&D Newin Paper & Pulp (HKSE:00731) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Forest Products » C&D Newin Paper & Pulp Corp Ltd (HKSE:00731) » Definitions » ROC %

Traded in Other Exchanges

N/A

Address

No. 168–200, Connaught Road Central, Rooms 2306B & 2307, 23rd Floor, West Tower, Shun Tak Centre, Hong Kong, HKG

Website

https://www.cndnewin.com

C&D Newin Paper & Pulp Corp Ltd is engaged in manufacturing, trading, and marketing of paper products, property development as well as leasing of investment properties. It is also engaged in trading of consumable aeronautic parts and providing marine services. The group's customers are mainly based in Hong Kong and the PRC. The company has carried on a single business segment under continuing operations, which is the manufacturing and selling of paper products.

Executives

Sha Men Jian Fa Jiang Zhi Ji Tuan You Xian Gong Si
Sha Men Jian Fa Ji Tuan You Xian Gong Si
Sha Men Jian Fa Gu Fen You Xian Gong Si
Sha Men Shi Ren Min Zheng Fu Guo You Zi Chan Jian Du Guan Li Wei Yuan Hui
Ncd Investment Holding Limited
Hong Kong Paper Sources Co., Limited
Lai Kar Yan (in The Capacity As A Receiver)	2501 Other
Ho Kwok Leung Glen (in The Capacity As A Receiver)	2501 Other
Kam Chung Hang	2501 Other
Strong Determine Limited	2501 Other
Lee Seng Jin	2201 Interest of corporation controlled by you
Sham Yee Lan Peggy	2202 Interest of your spouse
Quinselle Holdings Limited	2101 Beneficial owner
Xsd Investment Holding Limited	2201 Interest of corporation controlled by you
Xsd International Pte. Ltd.

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