Name: Texas Pacific Land Corp. (NYSE:TPL) | Cash Flow Statement
Creator: Stock Analysis on Net

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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Texas Pacific Land Corp., consolidated cash flow statement

US$ in thousands

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net income	405,645)	446,362)	269,980)	176,049)	318,728)
Depreciation, depletion and amortization	14,757)	15,376)	16,257)	14,395)	8,906)
Share-based compensation	10,343)	8,432)	28)	—)	—)
Deferred taxes	1,399)	1,263)	220)	(2,099)	25,924)
Land sales revenue recognized on land exchange	—)	—)	—)	(1,415)	(22,000)
Receivables and other assets	(24,457)	(13,833)	(47,603)	18,828)	(13,802)
Prepaid income taxes	4,809)	(4,809)	—)	—)	9,398)
Income taxes payable	1,628)	(25,916)	25,029)	(1,217)	3,664)
Unearned revenue	5,140)	1,938)	(1,910)	8,787)	4,012)
Operating liabilities, excluding income taxes	(3,240)	10,015)	3,152)	(6,291)	7,960)
Ad valorem and other taxes payable	2,264)	8,321)	10)	—)	—)
Changes in operating assets and liabilities	(13,856)	(24,284)	(21,322)	20,107)	11,232)
Adjustments to reconcile net income to net cash provided by operating activities	12,643)	787)	(4,817)	30,988)	24,062)
Cash provided by operating activities	418,288)	447,149)	265,163)	207,037)	342,790)
Acquisitions of intangible assets	(21,403)	—)	—)	—)	—)
Acquisition of real estate	(20,320)	(633)	(535)	(3,966)	(74,583)
Acquisition of royalty interests	(3,566)	(1,662)	—)	(16,946)	(5,017)
Purchase of fixed assets	(15,028)	(19,212)	(15,548)	(5,086)	(32,209)
Proceeds from sales of fixed assets	5)	106)	1,086)	—)	117)
Cash used in investing activities	(60,312)	(21,401)	(14,997)	(25,998)	(111,692)
Dividends paid	(99,972)	(247,281)	(85,264)	(201,660)	(46,546)
Repurchases of common stock	(42,573)	(87,765)	(19,684)	—)	—)
Shares exchanged for tax withholdings	(2,064)	(1,762)	—)	—)	—)
Repurchases of Sub-share Certificates in Certificates of Proprietary Interest	—)	—)	—)	—)	(4,353)
Cash used in financing activities	(144,609)	(336,808)	(104,948)	(201,660)	(50,899)
Net increase (decrease) in cash, cash equivalents and restricted cash	213,367)	88,940)	145,218)	(20,621)	180,199)
Cash, cash equivalents and restricted cash, beginning of period	517,182)	428,242)	283,024)	303,645)	123,446)
Cash, cash equivalents and restricted cash, end of period	730,549)	517,182)	428,242)	283,024)	303,645)

Based on: 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), 10-K (reporting date: 2019-12-31).

The financial performance between 2019 and 2023 is characterized by strong operating cash flow generation and a consistent strategy of returning capital to shareholders, while simultaneously increasing the overall cash position. Net income exhibited volatility, reaching a low in 2020 before peaking in 2022, with a corresponding trend observed in cash provided by operating activities.

Operating Cash Flow Trends: Cash provided by operating activities remained robust, ranging from a low of 207.0 million US dollars in 2020 to a high of 447.1 million US dollars in 2022. The close alignment between net income and operating cash flow suggests high earnings quality. Adjustments to reconcile net income were generally positive, although a notable negative adjustment occurred in 2021, primarily driven by a 47.6 million US dollar increase in receivables and other assets.
Investing Activities and Capital Expenditure: Investing activities were dominated by the acquisition of real estate and fixed assets. A significant investment phase occurred in 2019 with 74.6 million US dollars spent on real estate. Following a period of reduced capital expenditure from 2020 to 2022, investment spending increased again in 2023, totaling 60.3 million US dollars, which included 21.4 million US dollars for intangible assets and 20.3 million US dollars for real estate.
Financing Activities and Shareholder Returns: The company maintained an aggressive capital return policy through dividends and share repurchases. Dividends paid peaked in 2022 at 247.3 million US dollars. Common stock repurchases were introduced in 2021 and reached a peak of 87.8 million US dollars in 2022. Total cash used in financing activities peaked in 2022 at 336.8 million US dollars, reflecting a concentrated effort to return value to shareholders during that period.
Liquidity and Cash Position: Despite significant outflows for financing and investing, the overall liquidity position strengthened considerably. Cash, cash equivalents, and restricted cash grew from 303.6 million US dollars at the end of 2019 to 730.5 million US dollars by the end of 2023. This growth indicates that operating cash flows were more than sufficient to cover both capital investments and shareholder distributions.

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