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).

AIA 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 Auckland International Airport Limited (AIA), the free cash flow value is -131.60M.

All amounts in NZD

Operating Cash
101.2M
Capital Expenditure
-232.8M
Free Cash Flow
-131.60M

Auckland International Airport 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).

AIA Cash Flow Statement History

Following table shows the history of Cash Flow Statements sheet for Auckland International Airport Limited (ASX:AIA).

30 Jun 202230 Jun 202130 Jun 202030 Jun 2019
Net Income191.6M466.6M193.9M523.5M
Depreciation113.1M120.9M112.7M102.2M
Change To Netincome-190.9M-498.2M-170.1M-209.4M
Change To Account Receivables-3.1M9.3M35.7M2.5M
Change To Liabilities-9.3M-39.4M40.3M-45.4M
Change To Operating Activities500k700k200k100k
Total Cash From Operating Activities101.2M60.6M175.8M375.9M
Capital Expenditures-232.8M-148M-252.3M-246.1M
Investments-11M-10.4M-8.3M6.9M
Total Cashflows From Investing Activities-283.2M-216.1M-396.6M-318.7M
Net Borrowings128.6M-609.9M-125M75M
Other Cashflows From Financing Activities-1.4M79.6M79.6M79.6M
Total Cash From Financing Activities127.2M-530.3M948.8M-126.6M
Change In Cash-54.8M-685.8M728M-69.4M