BOI Rule 7 – ROCE (Return on Capitol Employed)

Return on Capital Employed is the return on all capital employed not just the funds from the directors and other backers. This would also include loans. We would look for a year-on-year ratio of greater than 10%.

ROCE is the primary measure of how efficiently a company utilises all available capital to generate additional profits, not just capital from shareholders.

Consistency is also very important.

ROCE acceptable and unacceptable chart results: