ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Life Concepts Holdings's annualized return on invested capital (ROIC %) for the quarter that ended in Sep. 2023 was 8.84%.
As of today (2024-06-05), Life Concepts Holdings's WACC % is 26.53%. Life Concepts Holdings's ROIC % is -8.86% (calculated using TTM income statement data).
Life Concepts Holdings earns returns that do not match up to its cost of capital. It will destroy value as it grows.
* 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.
Competitive Comparison of Life Concepts Holdings's ROIC %
For the Restaurants subindustry, Life Concepts Holdings'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.
Life Concepts Holdings's ROIC % Distribution in the Restaurants Industry
For the Restaurants industry and Consumer Cyclical sector, Life Concepts Holdings's ROIC % distribution charts can be found below:
* The bar in red indicates where Life Concepts Holdings's ROIC % falls into.
Life Concepts Holdings ROIC % Calculation
Life Concepts Holdings's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Mar. 2023 is calculated as:
Note:
The Operating Income data used here is four times the quarterly (Sep. 2023) data.
* 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.
Life Concepts Holdings (HKSE:08056) 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, Life Concepts Holdings's WACC % is 26.53%. Life Concepts Holdings's ROIC % is -8.86% (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.
Life Concepts Holdings ROIC % Related Terms
Thank you for viewing the detailed overview of Life Concepts Holdings's ROIC % provided by GuruFocus.com. Please click on the following links to see related term pages.
Life Concepts Holdings (HKSE:08056) Business Description
Life Concepts Holdings Ltd is an investment holding company. The company's operating segment includes Italian style; Western style; Asian style; Chinese Style; Catering management and design services and others; Provision of interior design and fitting-out services; Provision of organic vegetables consulting services and Provision of financial intermediation services. It generates maximum revenue from Western style segment. Geographically, it derives a majority of revenue from Hong Kong.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
HKSE:08056 has been successfully added to your 