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).

HSBA 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 HSBC Holdings plc (HSBA), the free cash flow value is 7.523B.

All amounts in USD

Operating Cash
8.61B
Capital Expenditure
-1.09B
Free Cash Flow
7.523B

HSBC Holdings 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).

HSBA Cash Flow Statement History

Following table shows the history of Cash Flow Statements sheet for HSBC Holdings plc (LSE:HSBA).

31 Dec 2021 31 Dec 2020 31 Dec 2019 31 Dec 2018
Net Income 13.92B 5.23B 7.38B 13.73B
Depreciation 2.52B 4.12B 3.17B 1.93B
Change To Netincome 19.56B -18.5B 7.34B 8.96B
Change To Liabilities
Change To Operating Activities -15.09B -47.62B -46.09B -5.7B
Total Cash From Operating Activities 8.61B -44.5B -49.42B 38.26B
Capital Expenditures -1.09B -1.45B -1.34B -1.2B
Investments 28.15B -19.68B -32.72B -13.4B
Total Cashflows From Investing Activities 27.54B -22.43B -35.32B -16.65B
Dividends Paid -5.79B -1.33B -9B -10.05B
Net Borrowings -864M -3.54B -4.21B -4.08B
Other Cashflows From Financing Activities 95.11B 226.03B 78.39B -6.46B
Total Cash From Financing Activities 84.91B 222.08B 64.32B -22.53B
Effect Of Exchange Rate -15.35B 19.43B 1.25B -9.89B
Change In Cash 105.71B 174.58B -19.17B -10.81B
Repurchase Of Stock -2.09B -181M -1B -2B