Cash flow is the net amount of cash and cash-equivalents being transferred into and out of a business. At the most fundamental level, a company’s ability to create value for shareholders is determined by its ability to generate positive cash flows, or more specifically, maximize long-term free cash flow (FCF).

ABV Free Cash Flow Analysis

Free cash flow, a measure commonly used by analysts to assess a company's profitability, represents the cash a company generates after accounting for cash outflows to support operations and maintain its capital assets.

The Free Cash Flow is calculated using a number of methods including using Operating Cash Flow. Following is the formula to calculate Free Cash Flow based on Operating Cash Flow.

Free Cash Flow = Operating Cash Flow - Capital Expenditures

Using above formula to calculate Free Cash Flow for Advanced Braking Technology Limited (ABV), the free cash flow value is 196000.

All amounts in AUD

Operating Cash
222k
Capital Expenditure
-26k
Free Cash Flow
196000

Advanced Braking Technology Limited has a positive free cash flow as per the latest annual Cash flow statement released by the company. Positive free cash flow is cruscial for the financial health of a company, which can be used to pay dividends, expand operations, and deleverage its balance sheet (i.e., reduce debt).

ABV Cash Flow Statement History

Following table shows the history of Cash Flow Statements sheet for Advanced Braking Technology Limited (ASX:ABV).

30 Jun 202030 Jun 201930 Jun 201830 Jun 2017
Net Income171k-1.71M-1.66M-565k
Depreciation264k211k219k266k
Change To Netincome100k100k100k-74k
Change To Account Receivables20k49k838k-890k
Change To Liabilities-123k101k-528k637k
Change To Inventory-165k-307k-510k-115k
Change To Operating Activities-51k196k42k-100k
Total Cash From Operating Activities222k-1.45M-1.55M-807k
Capital Expenditures-26k-133k-224k-363k
Total Cashflows From Investing Activities53k-133k-224k-265k
Net Borrowings-427k288k523k-595k
Other Cashflows From Financing Activities-48k-98k-98k-189k
Total Cash From Financing Activities-475k1.67M673k1.92M
Change In Cash-200k89k-1.11M846k