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.

Ecolab Inc., consolidated cash flow statement

US$ in thousands

12 months ended:	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Net income (loss) including noncontrolling interest	1,144,000)	(1,185,500)	1,576,200)	1,440,300)	1,522,400)
Net loss from discontinued operations including noncontrolling interest	—)	2,170,300)	—)	—)	—)
Net income from continuing operations including noncontrolling interest	1,144,000)	984,800)	1,576,200)	1,440,300)	1,522,400)
Depreciation	604,400)	594,300)	654,100)	621,300)	585,700)
Amortization	238,700)	218,400)	319,200)	317,000)	307,600)
Deferred income taxes	(1,100)	(45,800)	(37,600)	85,100)	(354,500)
Share-based compensation expense	89,500)	82,100)	91,100)	94,400)	90,500)
Pension and postretirement plan contributions	(60,200)	(70,700)	(186,000)	(60,000)	(144,100)
Pension and postretirement plan expense, net	42,400)	42,000)	28,100)	31,900)	36,900)
Restructuring charges, net of cash paid	(41,700)	7,800)	35,200)	43,500)	5,200)
Debt refinancing	29,400)	77,100)	—)	—)	—)
Gain on sale of businesses	—)	—)	—)	—)	(50,600)
Asset charges and write-downs	—)	—)	—)	—)	15,100)
Other, net	15,900)	61,000)	19,800)	24,000)	37,400)
Accounts receivable	(178,200)	155,600)	(137,200)	(164,100)	(91,800)
Inventories	(73,000)	(179,500)	41,000)	(141,100)	(85,500)
Other assets	(92,900)	42,300)	(81,500)	(80,700)	(48,900)
Accounts payable	200,400)	55,900)	22,300)	113,500)	121,100)
Other liabilities	144,300)	(283,500)	76,000)	(47,400)	144,800)
Changes in operating assets and liabilities, net of effect of acquisitions	600)	(209,200)	(79,400)	(319,800)	39,700)
Adjustments to reconcile net income to cash provided by operating activities	917,900)	757,000)	844,500)	837,400)	568,900)
Cash provided by operating activities	2,061,900)	1,741,800)	2,420,700)	2,277,700)	2,091,300)
Capital expenditures	(643,000)	(489,000)	(800,600)	(847,100)	(868,600)
Property and other assets sold	12,200)	5,300)	10,900)	30,000)	10,700)
Acquisitions and investments in affiliates, net of cash acquired	(3,923,700)	(487,000)	(391,400)	(229,800)	(989,200)
Divestiture of businesses	—)	116,200)	6,800)	9,200)	118,800)
Restricted cash activity	—)	—)	—)	—)	53,800)
Settlement of net investment hedges	—)	—)	—)	14,100)	2,100)
Other, net	(25,200)	(3,200)	(24,800)	(6,400)	(800)
Cash used for investing activities	(4,579,700)	(857,700)	(1,199,100)	(1,030,000)	(1,673,200)
Net issuances (repayments) of commercial paper and notes payable	393,600)	(65,500)	(252,000)	341,800)	(43,700)
Long-term debt borrowings	2,775,000)	1,855,900)	—)	—)	1,309,400)
Long-term debt repayments	(1,017,900)	(1,570,000)	(400,600)	(551,600)	(799,000)
Reacquired shares	(106,600)	(146,200)	(353,700)	(562,400)	(600,300)
Dividends paid	(566,400)	(560,800)	(554,900)	(496,500)	(448,700)
Exercise of employee stock options	143,500)	241,500)	186,800)	114,500)	83,800)
Debt refinancing	(29,400)	(77,100)	—)	—)	—)
Acquisition related liabilities and contingent consideration	—)	—)	(1,500)	(10,100)	(8,500)
Other, net	11,400)	(18,000)	26,300)	(8,400)	(15,700)
Cash provided by (used for) financing activities	1,603,200)	(340,200)	(1,349,600)	(1,172,700)	(522,700)
Cash provided by operating activities, discontinued operations	—)	118,400)	—)	—)	—)
Cash provided by investing activities, discontinued operations	—)	443,200)	—)	—)	—)
Cash used for financing activities, discontinued operations	—)	(1,600)	—)	—)	—)
Cash provided by discontinued operations	—)	560,000)	—)	—)	—)
Effect of exchange rate changes on cash and cash equivalents	14,300)	(30,100)	20,400)	7,600)	(11,400)
Increase (decrease) in cash and cash equivalents	(900,300)	1,073,800)	(107,600)	82,600)	(116,000)
Cash and cash equivalents, beginning of period	1,260,200)	186,400)	294,000)	211,400)	327,400)
Cash and cash equivalents, end of period	359,900)	1,260,200)	186,400)	294,000)	211,400)

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

Net Income and Operations Performance: The company exhibited fluctuating net income figures over the five-year period. Initially, net income from continuing operations rose moderately from approximately $1.52 billion in 2017 to a peak of about $1.58 billion in 2019, followed by a notable decline to $985 million in 2020 and a rebound to $1.14 billion in 2021. The year 2020 was marked by a significant net loss overall, primarily due to a substantial loss of $2.17 billion from discontinued operations. This divestiture activity in 2020 considerably affected the bottom line, reinstating profitability in 2021 from continuing operations.
Depreciation and Amortization: Depreciation expenses showed a steady increase from around $586 million in 2017 to $654 million in 2019 but then decreased to $594 million in 2020 and slightly increased again to $604 million in 2021. Amortization expenses followed a similar trend, rising marginally until 2019, followed by a marked decline in 2020, then a modest recovery in 2021. This pattern suggests periods of asset acquisition followed by a period of reduced intangible asset amortization.
Tax and Pension Items: Deferred income taxes fluctuated significantly, including an unusual positive value in 2018 after a negative balance in 2017, and remaining near zero in 2021. Pension and postretirement plan contributions decreased in absolute terms over the years, while net pension expense increased slightly by 2021, indicating changes in plan funding strategies or actuarial assumptions. Restructuring charges were higher in 2018 and 2019 but turned into net gains in 2021, possibly reflecting cost-cutting or operational efficiencies.
Operating Assets and Liabilities: Working capital items such as accounts receivable and inventories exhibited volatility. Accounts receivable decreased in 2017 and 2018, increased in 2020, then declined again in 2021. Inventories mirrored these movements with a sharp positive adjustment in 2019 but negative shifts in other years. Similarly, accounts payable saw consistent increases, especially rising markedly to $200 million in 2021, indicating extended payment cycles or vendor financing. Other liabilities showed significant swings, notably a large negative figure in 2020. Overall net changes in operating assets and liabilities were mixed, with large negative changes in 2018 and 2020 but almost neutral in 2021.
Cash Flows from Operating Activities: Cash generated from operating activities increased from $2.09 billion in 2017 to a peak of $2.42 billion in 2019, declined to $1.74 billion in 2020, and recovered to $2.06 billion in 2021. The decline in 2020 corresponds to lower net income and operational challenges likely related to the discontinued operations impact. Adjustments reconciling net income to cash flow were generally stable, with a slight dip in 2020.
Investing Activities: Capital expenditures decreased significantly between 2017 and 2020, dropping from $869 million to $489 million, but increased again to $643 million in 2021. The company undertook substantial acquisitions, particularly in 2021 with net outflows of about $3.92 billion, a sharp increase from prior years, indicating an aggressive investment or expansion strategy. Cash used in investing activities correspondingly reached its highest outflow in 2021. Divestitures contributed small positive cash inflows in earlier years, but no such activity is recorded in 2021.
Financing Activities: Financing cash flows were predominantly negative from 2017 through 2020, with repayments exceeding borrowings. This trend reversed in 2021, when net cash provided by financing activities rose significantly to $1.60 billion, largely driven by increased long-term debt borrowings totaling $2.78 billion. Repurchases of shares and dividend payouts consistently used cash throughout the period but decreased in magnitude over time, with repurchases declining notably by 2021. Overall, the financing pattern suggests a shift from deleveraging to increased leverage in 2021 alongside returning cash to shareholders.
Cash and Cash Equivalents: The cash position fluctuated considerably, with declines in 2017 and 2019, a substantial increase in 2020, and a sharp decrease in 2021. The large increase in cash during 2020 likely reflects operational cash flow and divestiture proceeds, whereas the decline in 2021 aligns with heavy investment outflows and changes in financing activities.
Other Observations: Exchange rate effects on cash balances were relatively minor but volatile, occasionally offsetting cash flow movements. Share-based compensation and other non-cash expenses showed little variation, indicating stable employee compensation policies. Notably, data gaps regarding discontinued operations are limited mainly to 2020, underscoring the impact of one-off transactions during that year.

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Ecolab Inc. (NYSE:ECL)

Cash Flow Statement