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).

MRO 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 Melrose Industries PLC (MRO), the free cash flow value is 43.00M.

All amounts in GBP

Operating Cash
263M
Capital Expenditure
-220M
Free Cash Flow
43.00M

Melrose Industries 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).

MRO Cash Flow Statement History

Following table shows the history of Cash Flow Statements sheet for Melrose Industries PLC (LSE:MRO).

31 Dec 2021 31 Dec 2020 31 Dec 2019 31 Dec 2018
Net Income 833M -536M -60M -475M
Depreciation 826M 863M 968M 620M
Change To Netincome -1.51B 15M -281M 280M
Change To Account Receivables 79M 269M 72M 172M
Change To Liabilities 14M -71M -2M -160M
Change To Inventory -31M 173M -12M -108M
Total Cash From Operating Activities 263M 764M 749M 373M
Capital Expenditures -220M -253M -465M -328M
Investments -10M -2M -50M -3M
Other Cashflows From Investing Activities 43M 28M -39M 57M
Total Cashflows From Investing Activities 2.51B -248M -415M -1.3B
Dividends Paid -69M -69M -231M -129M
Net Borrowings -1.61B -661M -176M 1.74B
Other Cashflows From Financing Activities -59M -15M -8M -277M
Total Cash From Financing Activities -2.47B -676M -415M 1.33B
Change In Cash 308M -157M -98M 399M