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).

## 0700 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 Tencent Holdings Limited (0700), the free cash flow value is 145.884B.

All amounts in CNY

Operating Cash
175.19B
Capital Expenditure
-29.3B
Free Cash Flow
145.884B

Tencent Holdings 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).

## 0700 Cash Flow Statement History

Following table shows the history of Cash Flow Statements sheet for Tencent Holdings Limited (HKEX:0700).

31 Dec 202131 Dec 202031 Dec 201931 Dec 2018
Net Income224.82B159.85B93.31B78.72B
Depreciation56.19B49.68B43.99B33.44B
Change To Netincome-108.2B-43.92B-4.72B-6.52B
Change To Account Receivables-4.03B-7.53B-6.04B-10.3B
Change To Liabilities22.89B31.22B18.5B22.45B
Change To Inventory1.3B-95M-394M-29M
Change To Operating Activities-19.27B3.83B3.26B-7.63B
Total Cash From Operating Activities175.19B194.12B148.59B110.94B
Capital Expenditures-29.3B-34.07B-22.77B-19.74B
Investments-90.55B-105.91B-50.24B-98.86B
Other Cashflows From Investing Activities-4.08B5.63B-8.52B4.38B
Total Cashflows From Investing Activities-178.55B-181.96B-116.17B-151.91B
Dividends Paid-12.5B-10.34B-8.31B-6.78B
Net Borrowings55.37B40.95B20.56B37.84B
Other Cashflows From Financing Activities-17.29B-16.82B-8.39B2.05B
Total Cash From Financing Activities21.62B13.65B1.67B30.89B
Effect Of Exchange Rate-3.09B-6B1.08B2.21B
Change In Cash15.17B19.81B35.18B-7.88B
Repurchase Of Stock-5B-1.86B-2.45B-2.75B
Issuance Of Stock1.04B1.72B272M525M