Cash Flow Statement
The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.
The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.
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- Statement of Comprehensive Income
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Long-term (Investment) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Common Stock Valuation Ratios
- Capital Asset Pricing Model (CAPM)
- Dividend Discount Model (DDM)
- Selected Financial Data since 2005
- Total Asset Turnover since 2005
- Price to Earnings (P/E) since 2005
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Linde plc, consolidated cash flow statement
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Net Income and Profitability Trends
- Net income exhibited a consistent upward trajectory from 2020 to 2024, increasing from $2.5 billion to approximately $6.6 billion. Income from continuing operations followed a similar pattern, rising steadily and indicating improved core business profitability. Noncontrolling interests from continuing operations also increased modestly, reflecting potentially higher minority stakeholder earnings or business expansion.
- Cost and Depreciation
- The cost reduction program and other charges showed significant volatility, with a large increase in 2022, followed by recovery into positive territory in subsequent years, suggesting fluctuating restructuring or extraordinary costs. Depreciation and amortization expenses decreased gradually from over $4.6 billion in 2020 to $3.8 billion in 2024, indicating possible depreciation of older assets or changes in asset base.
- Taxation and Compensation
- Deferred income taxes fluctuated, mostly negative but less so toward 2023, possibly reflecting changes in tax liabilities or accounting adjustments. Share-based compensation remained relatively stable, slightly increasing toward 2024, indicating consistent employee incentive expenses.
- Working Capital Elements
- Accounts receivable and contract assets/liabilities showed considerable variability, with contract assets/liabilities peaking notably in 2021 before declining into negative territory, possibly signifying changes in contract terms or billing timing. Inventory values decreased initially and recovered slightly by 2024. Payables and accruals peaked in 2021 but declined sharply afterward. Overall, working capital surged positively in 2021 but turned negative thereafter, indicating tightening short-term liquidity positions in recent years.
- Pension and Long-term Liabilities
- Pension contributions steadily declined from 2020 to 2024, implying lower funding requirements or plan changes. Long-term assets, liabilities, and other adjustments fluctuated without a clear trend, reflecting asset-liability management or other balance sheet movements.
- Cash Flows from Operations
- Adjusted net income reconciliation items decreased from a peak in 2021, and net cash provided by operating activities generally remained strong and slightly increased overall, showcasing robust operational cash generation despite some fluctuations.
- Investing Activities
- Capital expenditures increased steadily from about $3.4 billion in 2020 to $4.5 billion in 2024, indicating ongoing investment in infrastructure or growth. Acquisitions peaked sharply in 2023, suggesting significant corporate expansion or strategic purchases that year. Divestitures were relatively small and stable. Net cash used for investing activities increased notably after 2021, corresponding with elevated capital spending and acquisitions.
- Financing Activities
- Short-term debt borrowings showed inconsistency, with net repayments in some years and borrowings in others. Long-term debt borrowings increased substantially in 2024, offsetting repayments but suggesting increased leverage. Issuances of ordinary shares were minor and stable, while purchases of ordinary shares were sizable and consistent, reflecting sustained share repurchase programs. Cash dividends steadily increased, indicating growing shareholder returns. Overall, net cash used for financing was large but fell from a peak in 2021, likely due to lower repurchases and managed debt transactions.
- Cash Position and Exchange Effects
- Cash and cash equivalents fluctuated, rising significantly in 2022, decreasing in 2023, and showing a modest increase in 2024. Exchange rate effects were minor except for a significant negative impact in 2024, decreasing cash reserves. The net change in cash was positive overall though inconsistent, reflecting operational strength tempered by investing and financing outflows and currency fluctuations.
- Summary
- The financial data reveal a company with robust and growing profitability accompanied by significant ongoing capital investments and strategic acquisitions. Operational cash flow remains strong, supporting elevated capex and acquisition activities. Financing is characterized by increased debt activity and aggressive share repurchases with rising dividends, demonstrating a focus on shareholder returns and leverage management. Fluctuations in working capital and currency impacts introduce volatility to liquidity but have been generally managed effectively.