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