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).

LIC 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 Livestock Improvement Corporation Limited (LIC), the free cash flow value is 46.56M.

All amounts in NZD

Operating Cash
57.13M
Capital Expenditure
-10.57M
Free Cash Flow
46.56M

Livestock Improvement Corporation Limited 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).

LIC Cash Flow Statement History

Following table shows the history of Cash Flow Statements sheet for Livestock Improvement Corporation Limited (NZX:LIC).

31 May 2022 31 May 2021 31 May 2020 31 May 2019
Net Income 26.72M 22.94M 17.49M 22.17M
Depreciation 8.36M 7.97M 7.94M 7.58M
Change To Netincome 18.08M -2.74M 4.26M -1.92M
Change To Liabilities
Change To Operating Activities -6.25M -1.91M 2.57M 8.11M
Total Cash From Operating Activities 57.13M 40.46M 52.02M 55.17M
Capital Expenditures -10.57M -7.84M -6.23M -16.18M
Other Cashflows From Investing Activities 34.83M -612k -1.35M -1.64M
Total Cashflows From Investing Activities 17.68M -16.11M -21.4M -36.81M
Dividends Paid -26.36M -15.4M -13.12M -2.44M
Net Borrowings -3.6M -5.08M -5.96M -13.87M
Total Cash From Financing Activities -29.61M -21.82M -18.7M -16.34M
Effect Of Exchange Rate 110k -191k 37k -4k
Change In Cash 45.31M 2.33M 11.96M 2.01M
Issuance Of Stock 352k 352k 386k 60k