LKL International Bhd (XKLS:0182) ROC % : 0.08% (As of Dec. 2023)

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What is LKL International Bhd 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 %. LKL International Bhd's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was 0.08%.

As of today (2024-05-20), LKL International Bhd's WACC % is 9.59%. LKL International Bhd's ROC % is 4.12% (calculated using TTM income statement data). LKL International Bhd earns returns that do not match up to its cost of capital. It will destroy value as it grows.

LKL International Bhd ROC % Historical Data

The historical data trend for LKL International Bhd'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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LKL International Bhd ROC % Chart

LKL International Bhd Annual Data

Trend

Apr15

Apr16

Apr17

Apr18

Apr19

Apr20

Sep22

Dec23

ROC %

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-1.41

-4.59

7.99

-11.42

3.95

LKL International Bhd Quarterly Data
	Jul18	Oct18	Jan19	Apr19	Jul19	Oct19	Jan20	Apr20	Jul20	Oct20	Jan21	Jul21	Dec21	Mar22	Jun22	Sep22	Mar23	Jun23	Sep23	Dec23
ROC %	Get a 7-Day Free Trial															-19.46	2.67	1.45	-3.59	0.08

LKL International Bhd ROC % Calculation

LKL International Bhd'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: Sep. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	2.561 * ( 1 - -141.63% )	/	( (140.659	+	172.415)	/ 2 )
=	6.1881443	/	156.537
=	3.95 %

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	))
=	167.19	-	6.231	-	( 20.3	-	max(0, 8.022	-	62.89	+	20.3	))
=	140.659

	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	))
=	214.966	-	5.98	-	( 36.571	-	max(0, 41.893	-	99.09	+	36.571	))
=	172.415

LKL International Bhd'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 )
=	10.14 * ( 1 - 98.67% )	/	( (157.866	+	172.415)	/ 2 )
=	0.134862	/	165.1405
=	0.08 %

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	))
=	204.895	-	7.428	-	( 39.601	-	max(0, 24.859	-	97.327	+	39.601	))
=	157.866

	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	))
=	214.966	-	5.98	-	( 36.571	-	max(0, 41.893	-	99.09	+	36.571	))
=	172.415

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

LKL International Bhd (XKLS:0182) 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, LKL International Bhd's WACC % is 9.59%. LKL International Bhd's ROC % is 4.12% (calculated using TTM income statement data). LKL International Bhd 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.

LKL International Bhd ROC % Related Terms

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LKL International Bhd (XKLS:0182) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » LKL International Bhd (XKLS:0182) » Definitions » ROC %

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Address

Wisma LKL, No.3, Jalan BS7/18, Kawasan Perindustrian Bukit Serdang, Seksyen 7, Seri Kembangan, SGR, MYS, 43300

Website

https://www.lklbeds.com

LKL International Bhd is Malaysian company which is principally engaged in the provision of medical and healthcare beds, peripherals and accessories. The company's operating segments are Manufacturing and Trading. The Manufacturing segment is involved in the manufacturing of medical and healthcare beds, medical peripherals and accessories and the Trading segment is involved in trading of medical peripherals and accessories. The company serves its products to various end users such as hospitals and medical centers, as well as other healthcare-related facilities including clinics and specialist institutions. LKL operates its business in Malaysia, Africa, Asia, Europe and other regions. Majority of its revenue is earned from Malaysia.

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