ROCE Calculator

ROCE Calculator

Fixed Capital:

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  • What is Return On Capital Employed?

    What is ROCE?

    ROCE is short for return on capital employed. Turkish is the return of the capital used. ROCE is a rate that gives information about the profitability of the investments in which the fixed capital of a business operates. Thanks to this rate, the efficiency of the company can be measured and compared with its competitors. The fact that the capital cost is higher than ROCE means that the company works inefficiently.

    Why ROCE Matters?

    ROCE analyzes all the company's capital, unlike ROCE ROE , which is considered only as equity. It is especially useful in companies belonging to capital-intensive sectors such as public services or telecommunications. Because it makes it possible and more effective to analyze the activities of companies with significant debts.

    How is ROCE Calculated?

    The ROCE calculation formula is simple. It can be calculated with two variables.
    1. The company's profit before interest tax, namely EBIT,
    2. Total capital of the company. It can be calculated with the formula
    ROCE = EBITDA / Fixed assets x 100%. It is expressed in% in the figure found.