093 682 682 | 078 868 848 | info@pp-hr.com | Join Discussion | ខ្មែរ | English  | 日本語 | 中文  | ไทย한국어Tiếng Việt

Free cash flow (FCF) or free cash flow to firm (FCFF)

Free cash flow (FCF) or free cash flow to firm (FCFF)

Free cash flow (FCF) or free cash flow to firm (FCFF) is a measure of a company’s financial performance, calculated as operating cash flow minus capital expenditures. FCF represents the cash that a company is able to generate after spending the money required to maintain or expand its asset base.

Free cash flow (FCF) is cash flow available for distribution among all the securities holders of a corporate entity. It is useful for investors such as equity holders, debt holders, preferred stock holders, and convertible security holders when they want to see how much cash can be extracted from a company without causing issues to its operations.

Free cash flow can be calculated as follows:

1. Earnings before Interest and Taxes (EBIT) as Base

Free Cash Flow=

EBIT x (1-Tax rate)

+ Depreciation & Amortization

– Changes in Working Capital

– Capital expenditure (CAPEX)

2. Net Profit as Base

Free Cash Flow=

Net Profit

+ Interest expense

– Net Capital Expenditure (CAPEX)

– Net changes in Working Capital

– Tax shield on Interest Expense

where

Net Capital Expenditure (CAPEX) = Capital Expenditure – Depreciation & Amortization

Tax Shield = Net Interest Expense x Marginal Tax Rate

Find Jobs Here !

Featured Jobs

Responsibilities Responsible for all underwriting matters related to acceptance of risks/policies and ensures that it is in compliance with the company’s business strategies and risk acceptance guidelines. Conducts review on new and renewal cases. Ensures that issuance of policy documentation is within the timeframe set. Handles enquiries from customers, agents, brokers, reinsurers and internal customers. Provides technical underwriting support to
Responsibilities Sells and markets a wide range of general insurance products and services to meet set targets.  Requirements A recognised University Degree preferably related to Finance and Marketing; Experience in the sales of insurance or financial products will be an advantage; Outgoing with excellent interpersonal and communication skills. Ability to converse in Chinese will be an added advantage. Committed, highly
Loading...