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).

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 AD1 Holdings Limited (AD1), the free cash flow value is -2.11M.

All amounts in AUD

Operating Cash
-2.09M
Capital Expenditure
-14.74k
Free Cash Flow
-2.11M

AD1 Holdings Limited has a negative 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).

Following table shows the history of Cash Flow Statements sheet for AD1 Holdings Limited (ASX:AD1).

30 Jun 202030 Jun 201930 Jun 201830 Jun 2017
Net Income-2.18M-4.38M-4.75M-4.48M
Depreciation186.32k37.17k12.56k6.51k
Change To Netincome29.19k-681.34k376.87k402.6k
Change To Account Receivables-68.95k340.11k-312.08k35.31k
Change To Liabilities31.97k-86.55k-197.64k-336.22k
Change To Operating Activities-128.6k93.29k14.3k179.5k
Total Cash From Operating Activities-2.09M-4.67M-4.85M-4.19M
Capital Expenditures-14.74k-27.02k-14.65k-31.69k
Other Cashflows From Investing Activities-14.63k-14.63k-14.63k-14.63k
Total Cashflows From Investing Activities-29.36k811.88k-14.65k-31.69k
Net Borrowings-92.39k-92.39k-92.39k-92.39k
Total Cash From Financing Activities1.74M1.97M4.39M49.87k
Change In Cash-379.25k-1.89M-480.77k-4.17M
Issuance Of Stock1.83M2.01M4.58M49.87k