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).

## TW 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 Taylor Wimpey plc (TW), the free cash flow value is 429.40M.

All amounts in GBP

Operating Cash
431.9M
Capital Expenditure
-2.5M
Free Cash Flow
429.40M

Taylor Wimpey 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).

## TW Cash Flow Statement History

Following table shows the history of Cash Flow Statements sheet for Taylor Wimpey plc (LSE:TW).

31 Dec 202131 Dec 202031 Dec 201931 Dec 2018
Net Income555.5M217M673.9M656.6M
Depreciation12M12.6M11.9M12.1M
Change To Netincome127.9M-77.6M-68.1M26.1M
Change To Account Receivables32.1M-19.5M-12.7M-10.9M
Change To Liabilities-6M-75.3M-74.9M-41.9M
Change To Inventory-293.2M-362.2M-21.7M-1.7M
Total Cash From Operating Activities431.9M-301.2M510M641.3M
Capital Expenditures-2.5M-3.1M-7.2M-2.1M
Investments-5.9M-19.8M-6.3M-6.4M
Other Cashflows From Investing Activities200k3.9M10.3M17.1M
Total Cashflows From Investing Activities-10.3M-23.9M-8.6M8.7M
Dividends Paid-301.5M-301.5M-249.8M-159.5M
Net Borrowings-19.6M5.5M-8.4M-8.3M
Total Cash From Financing Activities-321.7M516.4M-602.6M-516.2M
Effect Of Exchange Rate-1.9M1.3M-2.6M-100k
Change In Cash98M192.6M-103.8M133.7M
Repurchase Of Stock-4.2M-4.2M-4.2M-9.9M
Issuance Of Stock3.6M510.9M5.5M1.5M