ROCE
Return on capital employed (ROCE) is the rate of return a business is making on the total capital employed in the business. Capital will include all sources of funding (shareholders funds + debt).
ROCE is the ratio of operating profit (earnings before interest and tax) to capital employed, expressed as a percentage.
ROCE = 80/(200+200) * 100% or 20%
This is the return made for investors and lenders. From an investment point of view the higher this number the better. ROCE can be used to compare the returns available from other companies.
Return on capital employed (ROCE)
Definition: Return on capital employed ROCE, sometimes called Return on Net Assets (RONA), ...
return on capital employed ROCE
The ratio of EBIT to shareholders' equity plus long-term liabilities (debt), expressed as a percentage.
Return on capital employed (ROCE)
The operating profit before interest and tax as a percentage of the total shareholders' funds plus
the long-term debt of the business.
Related Terms: ...
ROCE is calculated as company earnings divided by average capital employed. The formula is as follows:
Comparing ROE and ROCE
Let's look at an example featuring two companies with identical earnings before interest and tax (EBIT).
ROCE (Return on Capital Employed)
The ROCE ratio measures the profitability of capital employed. ROCE is calculated by dividing pre-tax income by capital employed (assets and working capital).
ROE (Return on Equity) ...
Abbr ROCE.
Also called return on capital
Recommended Further Reading (Term count) ...
ROCE
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Return on Capital Employed (ROCE) is a measuring tool that measures the efficiency and profitability of capital investments undertaken by a corporation.
Return on capital employed (ROCE) - The profit of a business as a percentage of the total amount of money used to generate it. ROCE is a measure of the effectiveness of the way a firm is using its capital.
The return on capital (ROCE) can be increased by higher profits, using less capital, by creating and selling books more quickly or by a combination of both. We shall study this in the next chapter on new title investment and pricing decisions.
Return on capital employed (ROCE)
Indicator of profitability of the firm's capital investments. Determined by dividing Earnings Before Interest and Taxes by (capital employed plus short-term loans minus intangible assets).
Return on capital employed (ROCE)
Indicates the efficiency with which a company uses its assets to generate profits.
Return on capital employed (ROCE)
Assesses a company's profitability, usually expressed as a percentage. It is calculated as profit divided by capital multiplied by 100.
Burn Rate Key Factor In Company's Sustainability
Spotting Profitability With ROCE
Fundamental Analysis: The Balance Sheet
Microeconomics: Making Economic Decisions - Starting A Business ...
Spotting Profitability With ROCE
Take a deeper look at a company's profitability with the help of profit-margin ratios. The Bottom Line On Margins
Find out how fixed and variable costs interact to shed new light on old companies.
 See also: Capital Employed, Return on capital employed, Expense, Saving, Return On Equity
  
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