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).

AAL 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 Anglo American plc (AAL), the free cash flow value is 10.991B.

All amounts in USD

Operating Cash
16.72B
Capital Expenditure
-5.73B
Free Cash Flow
10.991B

Anglo American plc 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).

AAL Cash Flow Statement History

Following table shows the history of Cash Flow Statements sheet for Anglo American plc (LSE:AAL).

31 Dec 202131 Dec 202031 Dec 201931 Dec 2018
Net Income8.56B2.09B3.55B3.55B
Depreciation2.71B2.6B2.81B2.6B
Change To Netincome4.69B3.34B1.33B954M
Change To Account Receivables-637M-1.03B-170M-74M
Change To Liabilities1.37B1.06B554M570M
Change To Inventory328M-1.56B-434M-526M
Change To Operating Activities-303M126M22M58M
Total Cash From Operating Activities16.72B6.62B7.66B7.13B
Capital Expenditures-5.73B-4.65B-4.74B-3.4B
Investments-6M53M-86M-102M
Other Cashflows From Investing Activities168M46M132M161M
Total Cashflows From Investing Activities-5.56B-4.74B-4.72B-3.1B
Dividends Paid-3.05B-904M-1.42B-1.29B
Net Borrowings-922M1.73B813M-2.74B
Other Cashflows From Financing Activities-3.3B-1.16B-1.46B-650M
Total Cash From Financing Activities-9.36B-716M-3.12B-4.98B
Effect Of Exchange Rate-260M11M-45M-296M
Change In Cash1.55B1.17B-213M-1.24B
Repurchase Of Stock-1.08B-385M-1.04B-293M