Revolution Beauty Group (LSE:REVB) ROIC % : -1.15% (As of Aug. 2023)

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What is Revolution Beauty Group ROIC %?

ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Revolution Beauty Group's annualized return on invested capital (ROIC %) for the quarter that ended in Aug. 2023 was -1.15%.

As of today (2024-05-04), Revolution Beauty Group's WACC % is 10.17%. Revolution Beauty Group's ROIC % is -15.15% (calculated using TTM income statement data). Revolution Beauty Group earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Revolution Beauty Group ROIC % Historical Data

The historical data trend for Revolution Beauty Group's ROIC % 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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Revolution Beauty Group ROIC % Chart

Revolution Beauty Group Annual Data

Trend

Dec17

Dec18

Dec19

Feb22

Feb23

ROIC %

6.38

-2.07

-14.18

-28.03

Revolution Beauty Group Semi-Annual Data
	Dec18	Dec19	Aug21	Feb22	Aug22	Feb23	Aug23
ROIC %	Get a 7-Day Free Trial			-28.57	2.44	-38.00	-29.47	-1.15

Competitive Comparison of Revolution Beauty Group's ROIC %

For the Household & Personal Products subindustry, Revolution Beauty Group'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.

Revolution Beauty Group's ROIC % Distribution in the Consumer Packaged Goods Industry

For the Consumer Packaged Goods industry and Consumer Defensive sector, Revolution Beauty Group's ROIC % distribution charts can be found below:

* The bar in red indicates where Revolution Beauty Group's ROIC % falls into.

Revolution Beauty Group ROIC % Calculation

Revolution Beauty Group's annualized Return on Invested Capital (ROIC %) for the fiscal year that ended in Feb. 2023 is calculated as:

	ROIC % (A: Feb. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Feb. 2022 )	+	Invested Capital (A: Feb. 2023 ))	/ count )
=	-23.746 * ( 1 - 0.67% )	/	( (74.962	+	93.314)	/ 2 )
=	-23.5869018	/	84.138
=	-28.03 %

where

	Invested Capital		(A: Feb. 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	))
=	142.489	-	51.908	-	( 15.619	-	max(0, 100.327	-	117.02	+	15.619	))
=	74.962

	Invested Capital		(A: Feb. 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	))
=	131.403	-	57.138	-	( 11.044	-	max(0, 134.486	-	115.437	+	11.044	))
=	93.314

Revolution Beauty Group's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Aug. 2023 is calculated as:

	ROIC % (Q: Aug. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Feb. 2023 )	+	Invested Capital (Q: Aug. 2023 ))	/ count )
=	-1.056 * ( 1 - 5.74% )	/	( (93.314	+	79.632)	/ 2 )
=	-0.9953856	/	86.473
=	-1.15 %

where

	Invested Capital		(Q: Feb. 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	))
=	131.403	-	57.138	-	( 11.044	-	max(0, 134.486	-	115.437	+	11.044	))
=	93.314

	Invested Capital		(Q: Aug. 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	))
=	112.131	-	40.099	-	( 8.006	-	max(0, 105.715	-	98.115	+	8.006	))
=	79.632

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

Revolution Beauty Group (LSE:REVB) 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, Revolution Beauty Group's WACC % is 10.17%. Revolution Beauty Group's ROIC % is -15.15% (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.

Revolution Beauty Group ROIC % Related Terms

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Revolution Beauty Group (LSE:REVB) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Consumer Packaged Goods » Revolution Beauty Group PLC (LSE:REVB) » Definitions » ROIC %

Comparable Companies

Traded in Other Exchanges

8UA:Germany

Address

90 York Way, Kings Place, London, GBR, N1 9AG

Website

https://www.revolutionbeautyplc.com

Revolution Beauty Group PLC is a global mass beauty and personal care business that operates a multi-brand, multi-category strategy and sells its products both DTC via its e-commerce operations, and in both physical and digital retailers through wholesale relationships. It has warehousing facilities in the UK, USA, and Australia, and offices in the UK, USA, New Zealand, and Germany.