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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- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Analysis of Reportable Segments
- Enterprise Value to EBITDA (EV/EBITDA)
- Enterprise Value to FCFF (EV/FCFF)
- Capital Asset Pricing Model (CAPM)
- Dividend Discount Model (DDM)
- Return on Equity (ROE) since 2005
- Return on Assets (ROA) since 2005
- Analysis of Revenues
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Johnson & Johnson, consolidated cash flow statement
US$ in millions
Based on: 10-K (reporting date: 2024-12-29), 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 earnings
- Net earnings exhibited volatility over the five-year period. There was a notable increase from 14,714 million US$ in 2020 to a peak of 35,153 million US$ in 2023, followed by a significant decline to 14,066 million US$ in 2024, indicating fluctuating profitability.
- Depreciation and amortization of property and intangibles
- These expenses remained relatively stable, fluctuating between 6,970 million US$ and 7,486 million US$, showing a consistent level of depreciation and amortization charges year-on-year.
- Stock based compensation
- Stock-based compensation showed a gradual increase each year, from 1,005 million US$ in 2020 to 1,176 million US$ in 2024, reflecting rising personnel and compensation costs.
- Asset write-downs
- Asset write-downs rose substantially from 233 million US$ in 2020 to a peak of 1,295 million US$ in 2023 before falling sharply to 405 million US$ in 2024, indicating episodic impairments within the period.
- Charges for acquired in-process research and development assets
- This item was non-existent until 2023 when it appeared at 483 million US$, then surged to 1,841 million US$ in 2024, highlighting increased investment or write-offs related to acquired R&D.
- Gain on Kenvue separation
- A one-time gain of 20,984 million US$ was recognized in 2023, corresponding to the Kenvue separation, positively influencing profitability in that year.
- Contingent consideration reversal
- This reversal was reported only in 2020 at -1,148 million US$, absent in subsequent years, indicating a prior adjustment no longer recurring.
- Net gain on sale of assets/businesses
- There was a consistent net loss from sales of assets or businesses each year, varying from -111 million US$ in 2020 to a more moderate -117 million US$ in 2023, suggesting ongoing divestitures with losses.
- Deferred tax provision
- The deferred tax provision showed variability, with significant negative expenses (benefits) in some years, including -4,194 million US$ in 2023, suggesting tax-related adjustments significantly affecting net income.
- Working capital changes
- Accounts receivable decreased consistently, reducing cash inflows in most years; inventories also decreased, contributing to cash flow. Accounts payable and accrued liabilities increased overall, enhancing operating cash inflows. Other current and non-current assets and liabilities showed mixed fluctuations, indicating dynamic working capital management.
- Adjustments to reconcile net earnings to cash flow from operating activities
- Adjustments displayed high variability, with a large positive adjustment in 2024 at 10,200 million US$ following a sharp negative adjustment in 2023 (-12,362 million US$), possibly related to non-cash items and special events.
- Net cash flows from operating activities
- Operating cash flow remained robust and relatively stable across the period, ranging from about 21,194 million US$ to 24,266 million US$, highlighting strong cash generation despite earnings volatility.
- Investing activities
- Capital expenditures steadily increased from 3,347 million US$ in 2020 to a peak of 4,543 million US$ in 2023 before slightly decreasing. Proceeds from disposal of assets were positive but relatively modest. Acquisitions showed considerable fluctuation, exceeding 17,000 million US$ outflows in 2022 and 2024, indicating significant investment activity. Purchases and sales of investments varied, with a peak sale of investments in 2022 (41,609 million US$). Net cash used by investing activities was negative in most years, except for 2023 where it was positive due to possible asset sales or reduced investments.
- Financing activities
- Dividend payments increased gradually, ranging from 10,481 million US$ to 11,823 million US$. Stock repurchases peaked in 2022 at 6,035 million US$ before declining in 2024. Proceeds from short and long-term debt fluctuated, with notable refinancing activity including significant repayments in 2023. Financing cash flows were negative in all years, except for a reduced outflow in 2024, reflecting consistent shareholder returns and debt management.
- Special transactions related to Kenvue
- Several one-time cash flows related to the Kenvue separation were observed in 2023, including proceeds from the IPO and debt transfer, as well as cash transferred to Kenvue. These had a material impact on cash flows in that year.
- Cash position and overall liquidity
- Cash and cash equivalents ended the year significantly higher in 2024 (24,105 million US$) compared to 2020 (13,985 million US$). The company demonstrated an ability to build liquidity despite substantial investing and financing outflows. The increase in cash balances in 2023 and 2024 reflects strong operating cash generation and effects of strategic transactions.
- Overall trends
- The data indicate a company with steady operating cash flow and active capital allocation through investments, acquisitions, and returns to shareholders. Significant one-time events, including the Kenvue separation and related gains, notably influenced trends in 2023. Earnings volatility contrasts with relatively stable cash generation, suggesting non-cash or exceptional items impacting reported profitability. The liquidity position strengthened over time, supporting ongoing operations and strategic objectives.