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).

0003 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 The Hong Kong and China Gas Company Limited (0003), the free cash flow value is 3.196B.

All amounts in HKD

Operating Cash
10.47B
Capital Expenditure
-7.27B
Free Cash Flow
3.196B

The Hong Kong and China Gas Company 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).

0003 Cash Flow Statement History

Following table shows the history of Cash Flow Statements sheet for The Hong Kong and China Gas Company Limited (HKEX:0003).

31 Dec 202131 Dec 202031 Dec 201931 Dec 2018
Net Income5.13B6.12B7.06B9.42B
Depreciation3.29B2.94B2.75B2.48B
Change To Netincome1.51B650.7M98.2M-2.61B
Change To Account Receivables-161.7M-783.5M-953.7M-621.9M
Change To Liabilities985.5M1.1B797.9M618.2M
Change To Inventory-385.9M-216.5M92.8M44.8M
Change To Operating Activities107.4M99.3M59.4M52.4M
Total Cash From Operating Activities10.47B9.91B9.91B9.44B
Capital Expenditures-7.27B-7.22B-6.75B-6.57B
Investments-6.32B-969.5M-353.3M746.1M
Other Cashflows From Investing Activities728M2.15B1.77B2.1B
Total Cashflows From Investing Activities-12.92B-5.99B-5.3B-3.78B
Dividends Paid-6.33B-6.03B-5.57B-5.06B
Net Borrowings12.75B3.57B2.31B-746M
Other Cashflows From Financing Activities-1.03B-2.06B-1.89B-1.98B
Total Cash From Financing Activities5.39B-4.52B-5.21B-7.79B
Effect Of Exchange Rate159.5M206M-49.6M-131.6M
Change In Cash3.1B-393.9M-651.9M-2.26B