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Tesco PLC (OTCPK:TSCDY)
Cash Flow from Investing
$-4,741 Mil (TTM As of Feb. 2014)

Cash Flow from Investing covers the cash a company gains or spends from investment activities in financial market and operating subsidiaries. It also includes the cash the company used for property, plant and equipment (PPE).

For the six months ended in Feb. 2014, Tesco PLC spent $2,203 Mil on purchasing property, plant, equipment. It gained $794 Mil from selling property, plant, and equipment. It spent $-48 Mil on purchasing business. It gained $101 Mil from selling business. It spent $525 Mil on purchasing investments. It gained $0 Mil from selling investments. It paid $367 Mil for net Intangibles purchase and sale. It paid $0 Mil for discontinued investing activities. And it paid $404 Mil for other investing activities. In all, Tesco PLC spent $2,555 Mil on investment activities in financial market and operating subsidiaries for the six months ended in Feb. 2014.


Definition

Cash Flow from Investing covers the cash a company gains or spends from investment activities in financial market and operating subsidiaries. It also includes the cash the company used for property, plant and equipment (PPE).

If a company spends cash on property, plant and equipment (PPE), this will reduce their cash position. This is called Capital Expenditures (CPEX).

Likewise, if a company buys another company for cash, this will reduce their cash position.

Tesco PLC's Cash Flow from Investing for the fiscal year that ended in Feb. 2014 is calculated as:

Cash Flow from Investing(A: Feb. 2014 )
=Purchase of PPE+Sale of PPE+Purchase of Business
=-4134.55149502+943.521594684+-41.5282392027
+Sale of Business+Purchase of Investment+Sale of Investment
+101.328903654+-820.598006645+0
+Net Intangibles Purchase And Sale+Cash From Discontinued Investing+Cash From Other Investing
+-647.840531561+0+-141.196013289
=-4,741

Tesco PLC's Cash Flow from Investing for the quarter that ended in Feb. 2014 is calculated as:

Cash Flow from Investing(Q: Feb. 2014 )
=Purchase of PPE+Sale of PPE+Purchase of Business
=-2202.65780731+794.019933555+48.1727574751
+Sale of Business+Purchase of Investment+Sale of Investment
+101.328903654+-524.916943522+0
+Net Intangibles Purchase And Sale+Cash From Discontinued Investing+Cash From Other Investing
+-367.109634551+0+-403.65448505
=-2,555

For company reported semi-annually, GuruFocus uses latest annual data as the TTM data. Tesco PLC Cash Flow from Investing for the trailing twelve months (TTM) ended in Feb. 2014 was $-4,741 Mil.

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Explanation

Cash flow from investing contains nine items:

1. Purchase Of Property, Plant, Equipment:
Purchase of PPE indicates the amount used to purchase property, plant, and equipment.

Tesco PLC's purchase of property, plant, equipment for the six months ended in Feb. 2014 was $-2,203 Mil. It means Tesco PLC spent $2,203 Mil on purchasing property, plant, equipment.

In the capital spending for property, plant and equipment (PPE), some part of spending may be from the expansion of business. The business needs more property, plant and equipment (PPE) as it grows. Another part may be from replacement of the property, plant and equipment (PPE) of existing business. For some companies, the cash spent on replacing of the property, plant and equipment (PPE) of the existing business will be close to the depreciation of property, plant and equipment (PPE) reported in the income statement.

In Warren Buffett’s definition of “Owner’s Earnings”, he deducts the estimate of the cost of replacing the property, plant and equipment (PPE) of the existing business from cash flow from operations. The cash spent on the new property, plant, and equipment is not deducted. The reason is because these are not costs of the existing business. In his 1986 letter to shareholders, Warren Buffett wrote this about owner earnings:

"These represent (a) reported earnings plus (b) depreciation, depletion, amortization, and certain other non-cash charges...less (c) the average annual amount of capitalized expenditures for plant and equipment, etc. that the business requires to fully maintain its long-term competitive position and its unit volume....Our owner-earnings equation does not yield the deceptively precise figures provided by GAAP, since (c) must be a guess - and one sometimes very difficult to make. Despite this problem, we consider the owner earnings figure, not the GAAP figure, to be the relevant item for valuation purposes...All of this points up the absurdity of the 'cash flow' numbers that are often set forth in Wall Street reports. These numbers routinely include (a) plus (b) - but do not subtract (c)."

2. Sale Of Property, Plant, Equipment:
Sale of PPE indicates the amount gained from selling property, plant, and equipment.

Tesco PLC's sale of property, plant, equipment for the six months ended in Feb. 2014 was $794 Mil. It means Tesco PLC gained $794 Mil from selling property, plant, and equipment.

3. Purchase Of Business:
Purchase of business indicates the amount used to purchase business.

Tesco PLC's purchase of business for the six months ended in Feb. 2014 was $48 Mil. It means Tesco PLC spent $-48 Mil on purchasing business.

4. Sale Of Business:
Sale of business indicates the amount gained from selling business.

Tesco PLC's sale of business for the six months ended in Feb. 2014 was $101 Mil. It means Tesco PLC gained $101 Mil from selling business.

5. Purchase Of Investment:
Purchase of Investments represents cash outflow on the purchase of investments in securities.

Tesco PLC's purchase of investment for the six months ended in Feb. 2014 was $-525 Mil. It means Tesco PLC spent $525 Mil on purchasing investments.

6. Sale Of Investment:
Sale of Investments represents cash inflow on the sale of investments in securities.

Tesco PLC's sale of investment for the six months ended in Feb. 2014 was $0 Mil. It means Tesco PLC gained $0 Mil from selling investments.

7. Net Intangibles Purchase And Sale:
Net Intangibles purchase and sale means the net cash inflow received by a company that comes from the purchase and sale of intangibles. It equals the cash received from sale of intangibles minus the cash spent on purchasing intangibles.

Tesco PLC's net Intangibles purchase and sale for the six months ended in Feb. 2014 was $-367 Mil. It means Tesco PLC paid $367 Mil for net Intangibles purchase and sale.

8. Cash From Discontinued Investing Activities:
Cash from discontinued investing activities means the cash received by a company that comes from the discontinued investing activities.

Tesco PLC's cash from discontinued investing activities for the six months ended in Feb. 2014 was $0 Mil. It means Tesco PLC paid $0 Mil for discontinued investing activities.

9. Cash From Other Investing Activities:
Cash from other investing activities means the cash received by a company that comes from other investing activities.

Tesco PLC's cash from other investing activities for the six months ended in Feb. 2014 was $-404 Mil. It means Tesco PLC paid $404 Mil for other investing activities.


Related Terms

Cash Flow from Operations, Cash Flow from Financing, Cash Flow for Capital Expenditures, Purchase of PPE, Sale of PPE, Purchase of Business, Sale of Business, Purchase of Investment, Sale of Investment, Net Intangibles Purchase And Sale, Cash From Discontinued Investing, Cash From Other Investing


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Tesco PLC Annual Data

Feb05Feb06Feb07Feb08Feb09Feb10Feb11Feb12Feb13Feb14
PurchaseOfPPE -4,389-4,712-5,887-7,200-6,667-4,545-5,737-5,339-3,950-4,135
SaleOfPPE 1,5681,1591,5742,1121,4082,7473,0841,8052,038944
PurchaseOfBusiness -444-154-728-460-1,848-104-425-180-347-42
SaleOfBusiness 1001230000038101
PurchaseOfInvestment -290-590000-1,103-1,2140-821
SaleOfInvestment 0000001,16201,0870
NetIntangiblesPurchaseAndSale 0000000-528-555-648
CashFromDiscontinuedInvestingActivities 0000000000
CashFromOtherInvestingActivities 686342360-360-1,354-925164191,270-141
Cash Flow from Investing -2,859-3,424-4,558-5,908-8,462-2,827-3,003-5,036-419-4,741

Tesco PLC Semi-Annual Data

Aug09Feb10Aug10Feb11Aug11Feb12Aug12Feb13Aug13Feb14
PurchaseOfPPE -2,692-2,060-3,101-2,525-2,817-2,513-2,276-1,822-1,849-2,203
SaleOfPPE 1,2511,5921,9341,0818979051,269851143794
PurchaseOfBusiness 15-117-159-260-22747-218-143-8648
SaleOfBusiness 0000177-177110-650101
PurchaseOfInvestment 00-2,027995-1,47326400-283-525
SaleOfInvestment 002,131-1,0451,656-1,66171042400
NetIntangiblesPurchaseAndSale 0000-273-255-344-234-269-367
CashFromDiscontinuedInvestingActivities 0000000000
CashFromOtherInvestingActivities 494-1,381186-176793402021,081251-404
Cash Flow from Investing -931-1,967-1,036-1,931-1,981-3,049-54792-2,092-2,555
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