As per Warren Buffett’s categorization of businesses, Page Industries is a perfect example of a business that requires capital to grow and generates decent ROCE. Over the past ten years, Page has, on an average, reinvested around 50 per cent of its operating cash flows back into the core business via fixed asset investments to expand its manufacturing capacity. Despite this, the firm has either maintained or improved its ROCE over time, implying that it has successfully and consistently generated healthy ROCE on the reinvested capital as well.
