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).

LSEG 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 London Stock Exchange Group plc (LSEG), the free cash flow value is 2.505B.

All amounts in GBP

Operating Cash
2.6B
Capital Expenditure
-97M
Free Cash Flow
2.505B

London Stock Exchange Group 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).

LSEG Cash Flow Statement History

Following table shows the history of Cash Flow Statements sheet for London Stock Exchange Group plc (LSE:LSEG).

31 Dec 202131 Dec 202031 Dec 201931 Dec 2018
Net Income3.13B421M417M480M
Depreciation1.11B145M224M161M
Change To Netincome-2.23B84M110M89M
Change To Account Receivables702M-53M203M-107M
Change To Liabilities-319M21M37M3M
Change To Operating Activities-260M190M-299M-30M
Total Cash From Operating Activities2.6B972M837M722M
Capital Expenditures-97M-19M-41M-50M
Investments-28M-2M-261M-28M
Other Cashflows From Investing Activities20M5M5M5M
Total Cashflows From Investing Activities3.68B-193M-440M-163M
Dividends Paid-426M-257M-221M-189M
Net Borrowings-4.79B-266M-65M209M
Other Cashflows From Financing Activities-132M-19M-54M-498M
Total Cash From Financing Activities-5.35B-542M-340M-475M
Effect Of Exchange Rate-60M55M-74M44M
Change In Cash880M292M-17M128M