| A measure of a companys profitability. It may be defined as: earnings before interest and tax divided by total capital employed. ROCE takes the financial assets employed in the business, including borrowings and shareholders funds, and measures the return the company makes on them. If a company has a low ROCE, it is using its resources inefficiently. The difficulty lies in defining capital employed. Intangible assets are often excluded, for instance, even though items such as patents and the goodwill of an acquired company do represent investments on which a return is expected.
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