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Adtraction Group AB (OSTO:ADTR) ROIC % : -1.08% (As of Mar. 2024)


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What is Adtraction Group AB 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 %. Adtraction Group AB's annualized return on invested capital (ROIC %) for the quarter that ended in Mar. 2024 was -1.08%.

As of today (2024-05-23), Adtraction Group AB's WACC % is 7.87%. Adtraction Group AB's ROIC % is 0.17% (calculated using TTM income statement data). Adtraction Group AB earns returns that do not match up to its cost of capital. It will destroy value as it grows.


Adtraction Group AB ROIC % Historical Data

The historical data trend for Adtraction Group AB'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.

* Premium members only.

Adtraction Group AB ROIC % Chart

Adtraction Group AB Annual Data
Trend Dec19 Dec20 Dec21 Dec22 Dec23
ROIC %
28.20 16.98 9.88 7.82 -0.59

Adtraction Group AB Quarterly Data
Dec19 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24
ROIC % Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -3.85 -2.88 1.91 3.92 -1.08

Competitive Comparison of Adtraction Group AB's ROIC %

For the Advertising Agencies subindustry, Adtraction Group AB'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.


Adtraction Group AB's ROIC % Distribution in the Media - Diversified Industry

For the Media - Diversified industry and Communication Services sector, Adtraction Group AB's ROIC % distribution charts can be found below:

* The bar in red indicates where Adtraction Group AB's ROIC % falls into.



Adtraction Group AB ROIC % Calculation

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

ROIC % (A: Dec. 2023 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (A: Dec. 2022 ) + Invested Capital (A: Dec. 2023 ))/ count )
=7.012 * ( 1 - 133.16% )/( (264.391 + 520.635)/ 2 )
=-2.3251792/392.513
=-0.59 %

where

Invested Capital(A: Dec. 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))
=381.245 - 9.913 - ( 141.981 - max(0, 218.166 - 325.107+141.981))
=264.391

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))
=619.385 - 16.269 - ( 116.039 - max(0, 275.308 - 357.789+116.039))
=520.635

Adtraction Group AB's annualized Return on Invested Capital (ROIC %) for the quarter that ended in Mar. 2024 is calculated as:

ROIC % (Q: Mar. 2024 )
=NOPAT/Average Invested Capital
=Operating Income * ( 1 - Tax Rate % )/( (Invested Capital (Q: Dec. 2023 ) + Invested Capital (Q: Mar. 2024 ))/ count )
=-28.66 * ( 1 - 81.31% )/( (520.635 + 473.771)/ 2 )
=-5.356554/497.203
=-1.08 %

where

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))
=619.385 - 16.269 - ( 116.039 - max(0, 275.308 - 357.789+116.039))
=520.635

Invested Capital(Q: Mar. 2024 )
=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))
=573.337 - 7.704 - ( 117.184 - max(0, 220.692 - 312.554+117.184))
=473.771

Note: The Operating Income data used here is four times the quarterly (Mar. 2024) 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.


Adtraction Group AB  (OSTO:ADTR) 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, Adtraction Group AB's WACC % is 7.87%. Adtraction Group AB's ROIC % is 0.17% (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.


Adtraction Group AB ROIC % Related Terms

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Adtraction Group AB (OSTO:ADTR) Business Description

Traded in Other Exchanges
N/A
Address
Biblioteksgatan 29, Stockholm, SWE, 114 35
Adtraction Group AB is a full-service partner marketing platform, helping brands across multiple industries attract new customers, while helping partners monetise content and traffic. With a user-friendly platform, Adtraction connects brands with a diverse range of marketing partners, ranging from content sites, influencers, affiliates, mobile apps and comparison sites.