Fameglow Holdings (HKSE:08603) ROC % : 0.41% (As of Sep. 2023)

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What is Fameglow 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 %. Fameglow Holdings's annualized return on capital (ROC %) for the quarter that ended in Sep. 2023 was 0.41%.

As of today (2024-06-09), Fameglow Holdings's WACC % is 6.77%. Fameglow Holdings's ROC % is 6.72% (calculated using TTM income statement data). Fameglow Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Fameglow Holdings ROC % Historical Data

The historical data trend for Fameglow 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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Fameglow Holdings ROC % Chart

Fameglow Holdings Annual Data

Trend

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Mar23

ROC %

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-0.12

-16.06

-10.07

-2.74

6.70

Fameglow Holdings Quarterly Data
	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23
ROC %	Get a 7-Day Free Trial															2.30	1.14	22.04	2.49	0.41

Fameglow Holdings ROC % Calculation

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

	ROC % (A: Mar. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Mar. 2022 )	+	Invested Capital (A: Mar. 2023 ))	/ count )
=	22.133 * ( 1 - 3.85% )	/	( (332.109	+	302.966)	/ 2 )
=	21.2808795	/	317.5375
=	6.70 %

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	))
=	219.659	-	3.627	-	( 1.642	-	max(0, 156.587	-	40.51	+	1.642	))
=	332.109

	Invested Capital		(A: 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	))
=	208.141	-	5.55	-	( 19.22	-	max(0, 152.094	-	51.719	+	19.22	))
=	302.966

Fameglow 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: Jun. 2023 )	+	Invested Capital (Q: Sep. 2023 ))	/ count )
=	1.016 * ( 1 - 0% )	/	( (0	+	249.526)	/ 1 )
=	1.016	/	249.526
=	0.41 %

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	))
=	0	-	0	-	( 0	-	max(0, 0	-	0	+	0	))
=	0

	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	))
=	198.162	-	18.982	-	( 22.211	-	max(0, 148.483	-	78.137	+	22.211	))
=	249.526

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

Fameglow Holdings (HKSE:08603) 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, Fameglow Holdings's WACC % is 6.77%. Fameglow Holdings's ROC % is 6.72% (calculated using TTM income statement data). Fameglow Holdings 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.

Fameglow Holdings ROC % Related Terms

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Fameglow Holdings (HKSE:08603) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Personal Services » Fameglow Holdings Ltd (HKSE:08603) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

63 Wing Hong Street, Unit 304, Global Gateway Tower, Cheung Sha Wan, Kowloon, Hong Kong, HKG

Website

https://www.fameglow.com

Fameglow Holdings Ltd acts as an investment holding company. Through its subsidiaries, it is principally engaged in the provision of treatment services and the sale of skincare products in Hong Kong. The firm's treatment services comprise Energy-based procedures, minimally invasive procedures, and Traditional beauty services. The majority of revenue gets derived from Energy-based procedures. the company's revenue is derived from hong kong only.

Executives

Equal Joy Holdings Limited	2101 Beneficial owner
Fu Chi Ching	2201 Interest of corporation controlled by you
Yip Chun Kwok Danny	2201 Interest of corporation controlled by you

Fameglow Holdings (HKSE:08603) Headlines

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