Return on Capital (ROC)
Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company debt and equity structure. It measures business productivity performance.
Return on Invested Capital (ROIC)
General Mills Inc., ROIC calculation, comparison to benchmarks
| May 26, 2019 | May 27, 2018 | May 28, 2017 | May 29, 2016 | May 31, 2015 | May 25, 2014 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net operating profit after taxes (NOPAT)1 | 2,274,308) | 1,920,512) | 2,079,159) | 2,028,941) | 1,616,844) | 2,219,325) | |
| Invested capital2 | 27,385,340) | 27,608,082) | 18,984,610) | 18,400,346) | 19,241,428) | 19,362,635) | |
| Performance Ratio | |||||||
| ROIC3 | 8.30% | 6.96% | 10.95% | 11.03% | 8.40% | 11.46% | |
| Benchmarks | |||||||
| ROIC, Competitors4 | |||||||
| Altria Group Inc. | -1.13% | — | — | — | — | — | |
| Coca-Cola Co. | 11.99% | — | — | — | — | — | |
| Mondelēz International Inc. | 6.06% | — | — | — | — | — | |
| PepsiCo Inc. | 14.37% | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-05-26), 10-K (reporting date: 2018-05-27), 10-K (reporting date: 2017-05-28), 10-K (reporting date: 2016-05-29), 10-K (reporting date: 2015-05-31), 10-K (reporting date: 2014-05-25).
1 NOPAT. See details »
2 Invested capital. See details »
3 2019 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 2,274,308 ÷ 27,385,340 = 8.30%
4 Click competitor name to see calculations.
| Performance ratio | Description | The company |
|---|---|---|
| ROIC | A measure of the periodic, after tax, cash-on-cash yield earned in the business. | General Mills Inc. ROIC deteriorated from 2017 to 2018 but then slightly improved from 2018 to 2019. |
Decomposition of ROIC
General Mills Inc., decomposition of ROIC
Based on: 10-K (reporting date: 2019-05-26), 10-K (reporting date: 2018-05-27), 10-K (reporting date: 2017-05-28), 10-K (reporting date: 2016-05-29), 10-K (reporting date: 2015-05-31), 10-K (reporting date: 2014-05-25).
1 Operating profit margin (OPM). See calculations »
2 Turnover of capital (TO). See calculations »
3 Effective cash tax rate (CTR). See calculations »
The primary reason for the increase in return on invested capital (ROIC) over 2019 year is the decrease in effective cash tax rate (CTR).
Operating Profit Margin (OPM)
General Mills Inc., OPM calculation, comparison to benchmarks
| May 26, 2019 | May 27, 2018 | May 28, 2017 | May 29, 2016 | May 31, 2015 | May 25, 2014 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net operating profit after taxes (NOPAT)1 | 2,274,308) | 1,920,512) | 2,079,159) | 2,028,941) | 1,616,844) | 2,219,325) | |
| Add: Cash operating taxes2 | 383,900) | 674,791) | 579,670) | 745,707) | 676,323) | 821,360) | |
| Net operating profit before taxes (NOPBT) | 2,658,207) | 2,595,303) | 2,658,829) | 2,774,648) | 2,293,167) | 3,040,685) | |
| Net sales | 16,865,200) | 15,740,400) | 15,619,800) | 16,563,100) | 17,630,300) | 17,909,600) | |
| Profitability Ratio | |||||||
| OPM3 | 15.76% | 16.49% | 17.02% | 16.75% | 13.01% | 16.98% | |
| Benchmarks | |||||||
| OPM, Competitors4 | |||||||
| Altria Group Inc. | 7.75% | — | — | — | — | — | |
| Coca-Cola Co. | 29.41% | — | — | — | — | — | |
| Mondelēz International Inc. | 16.67% | — | — | — | — | — | |
| PepsiCo Inc. | 15.55% | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-05-26), 10-K (reporting date: 2018-05-27), 10-K (reporting date: 2017-05-28), 10-K (reporting date: 2016-05-29), 10-K (reporting date: 2015-05-31), 10-K (reporting date: 2014-05-25).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2019 Calculation
OPM = 100 × NOPBT ÷ Net sales
= 100 × 2,658,207 ÷ 16,865,200 = 15.76%
4 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| OPM | The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales. | General Mills Inc. OPM deteriorated from 2017 to 2018 and from 2018 to 2019. |
Turnover of Capital (TO)
General Mills Inc., TO calculation, comparison to benchmarks
| May 26, 2019 | May 27, 2018 | May 28, 2017 | May 29, 2016 | May 31, 2015 | May 25, 2014 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net sales | 16,865,200) | 15,740,400) | 15,619,800) | 16,563,100) | 17,630,300) | 17,909,600) | |
| Invested capital1 | 27,385,340) | 27,608,082) | 18,984,610) | 18,400,346) | 19,241,428) | 19,362,635) | |
| Efficiency Ratio | |||||||
| TO2 | 0.62 | 0.57 | 0.82 | 0.90 | 0.92 | 0.92 | |
| Benchmarks | |||||||
| TO, Competitors3 | |||||||
| Altria Group Inc. | 0.59 | — | — | — | — | — | |
| Coca-Cola Co. | 0.51 | — | — | — | — | — | |
| Mondelēz International Inc. | 0.44 | — | — | — | — | — | |
| PepsiCo Inc. | 1.13 | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-05-26), 10-K (reporting date: 2018-05-27), 10-K (reporting date: 2017-05-28), 10-K (reporting date: 2016-05-29), 10-K (reporting date: 2015-05-31), 10-K (reporting date: 2014-05-25).
1 Invested capital. See details »
2 2019 Calculation
TO = Net sales ÷ Invested capital
= 16,865,200 ÷ 27,385,340 = 0.62
3 Click competitor name to see calculations.
| Efficiency ratio | Description | The company |
|---|---|---|
| TO | The turnover of capital (TO) is the ratio of sales to invested capital. Capital turnover is a function of the efficiency of working capital management and of net fixed assets. | General Mills Inc. TO deteriorated from 2017 to 2018 but then slightly improved from 2018 to 2019. |
Effective Cash Tax Rate (CTR)
General Mills Inc., CTR calculation, comparison to benchmarks
| May 26, 2019 | May 27, 2018 | May 28, 2017 | May 29, 2016 | May 31, 2015 | May 25, 2014 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net operating profit after taxes (NOPAT)1 | 2,274,308) | 1,920,512) | 2,079,159) | 2,028,941) | 1,616,844) | 2,219,325) | |
| Add: Cash operating taxes2 | 383,900) | 674,791) | 579,670) | 745,707) | 676,323) | 821,360) | |
| Net operating profit before taxes (NOPBT) | 2,658,207) | 2,595,303) | 2,658,829) | 2,774,648) | 2,293,167) | 3,040,685) | |
| Tax Rate | |||||||
| CTR3 | 14.44% | 26.00% | 21.80% | 26.88% | 29.49% | 27.01% | |
| Benchmarks | |||||||
| CTR, Competitors4 | |||||||
| Altria Group Inc. | 124.76% | — | — | — | — | — | |
| Coca-Cola Co. | 19.32% | — | — | — | — | — | |
| Mondelēz International Inc. | 17.14% | — | — | — | — | — | |
| PepsiCo Inc. | 18.26% | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-05-26), 10-K (reporting date: 2018-05-27), 10-K (reporting date: 2017-05-28), 10-K (reporting date: 2016-05-29), 10-K (reporting date: 2015-05-31), 10-K (reporting date: 2014-05-25).
1 NOPAT. See details »
2 Cash operating taxes. See details »
3 2019 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × 383,900 ÷ 2,658,207 = 14.44%
4 Click competitor name to see calculations.
| Tax rate | Description | The company |
|---|---|---|
| CTR | Effective cash tax rate on operating income. | General Mills Inc. CTR increased from 2017 to 2018 but then decreased significantly from 2018 to 2019. |