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).

AIZ 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 Air New Zealand Limited (AIZ), the free cash flow value is -385.00M.

All amounts in NZD

Operating Cash
230M
Capital Expenditure
-615M
Free Cash Flow
-385.00M

Air New Zealand 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).

AIZ Cash Flow Statement History

Following table shows the history of Cash Flow Statements sheet for Air New Zealand Limited (ASX:AIZ).

30 Jun 202030 Jun 201930 Jun 201830 Jun 2017
Net Income-454M276M390M382M
Depreciation794M511M486M461M
Change To Netincome333M-20M-3M-42M
Change To Liabilities-253M65M146M89M
Change To Operating Activities-237M111M-27M-18M
Total Cash From Operating Activities230M986M1.03B904M
Capital Expenditures-615M-821M-809M-853M
Investments-36M-75M-2M177M
Other Cashflows From Investing Activities42M42M42M42M
Total Cashflows From Investing Activities-542M-883M-778M-616M
Dividends Paid-130M-260M-260M-236M
Net Borrowings-234M-175M18M27M
Other Cashflows From Financing Activities59M44M-37M-10M
Total Cash From Financing Activities-305M-391M-279M-513M
Change In Cash-617M-288M-26M-225M