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ABB Ltd (NYSE:ABB)
Cash Flow from Operations
$4,501 Mil (TTM As of Jun. 2016)

Cash flow from operations refers to the cash brought in through a company’'s normal business operations. It is the cash flow before any investment or financing activities. It is the cash version of net income.

For the three months ended in Jun. 2016, ABB Ltd's Net Income From Continuing Operations was $443 Mil. Its DDA was $287 Mil. Its Change In Working Capital was $424 Mil. Its cash flow from deferred tax was $-142 Mil. Its Cash Flow from Discontinued Operations was $0 Mil. Its Stock Based Compensation was $0 Mil. And its Cash Flow from Others was $70 Mil. In all, ABB Ltd's Cash Flow from Operations for the three months ended in Jun. 2016 was $1,082 Mil.


Definition

Cash flow from operations refers to the cash brought in through a company’'s normal business operations. It is the cash flow before any investment or financing activities. It is the cash version of net income.

ABB Ltd's Cash Flow from Operations for the fiscal year that ended in Dec. 2014 is calculated as:

ABB Ltd's Cash Flow from Operations for the quarter that ended in Jun. 2016 is

ABB Ltd Cash Flow from Operations for the trailing twelve months (TTM) ended in Jun. 2016 was 1173 (Sep. 2015 ) + 1994 (Dec. 2015 ) + 252 (Mar. 2016 ) + 1082 (Jun. 2016 ) = $4,501 Mil.

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


Explanation

Cash flow from operations contains six items:

1. Net Income From Continuing Operations:
Net Income From Continuing Operations indicates the net income that a firm brings in from ongoing business activities. These activities are expected to continue into the next reporting period. It excludes extraordinary items, income from the cumulative effects of accounting changes, non-recurring items, income from tax loss carry forward, and preferred dividends.

ABB Ltd's net income from continuing operations for the three months ended in Jun. 2016 was $443 Mil.

2. Depreciation, Depletion and Amortization:
Depreciation is a present expense that accounts for the past cost of an asset that is now providing benefits.
Depletion and amortization are synonyms for depreciation.
Generally:
• The term “depreciation” is used when discussing man made tangible assets
• The term “depletion” is used when discussing natural tangible assets
• The term “amortization” is used when discussing intangible assets

ABB Ltd's depreciation, depletion and amortization for the three months ended in Jun. 2016 was $287 Mil.

3. Change In Working Capital:
Working Capital is a measure of a company's short term liquidity or its ability to cover short term liabilities. It is defined as the difference between a company's current assets and current liabilities. Changes in Working Capital is reported in the cash flow statement since it is one of the major ways in which net income can differ from operating cash flow.

ABB Ltd's change in working capital for the three months ended in Jun. 2016 was $424 Mil. It means ABB Ltd's working capital increased by $424 Mil from Mar. 2016 to Jun. 2016 .

4. Deferred Tax:
It is the cash flow generated from deferred tax.

ABB Ltd's cash flow from deferred tax for the three months ended in Jun. 2016 was $-142 Mil.

5. Cash Flow from Discontinued Operations:
Cash received by a company that comes from the sale of part of business.

ABB Ltd's cash flow from discontinued operations for the three months ended in Jun. 2016 was $0 Mil.

6. Stock Based Compensation:
It is a way corporations use stock options to reward employees. It provides executives and employees the opportunity to share in the growth of the company and, if structured properly, can align their interests with the interests of the company's shareholders and investors, without burning the company's cash on hand.

ABB Ltd's stock based compensation for the three months ended in Jun. 2016 was $0 Mil.

7. Cash Flow from Others:
These are cash differences caused by the change of inventory, accounts payable, accounts receivable etc. For instance, if a company pays its suppliers slower, its cash position will build up faster. If a company receives payments from its customers slower, its account receivables will rise, and its cash position will grow more slowly (or even shrink).

ABB Ltd's cash flow from others for the three months ended in Jun. 2016 was $70 Mil.


Related Terms

Net Income From Continuing Operations, Depreciation, Depletion and Amortization, Change In Working Capital, Cash Flow from Discontinued Operations, Stock Based Compensation, Cash Flow from Others, Cash Flow from Investing


Historical Data

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

ABB Ltd Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
NetIncomeFromContinuingOperations 1,3903,7573,1183,1192,7323,3152,8122,9072,7182,055
CF_DDA 5706026616557029951,1821,3181,3051,160
ChangeInWorkingCapital -571-267-94339599-675-411-518189658
CF_DeferredTax 113-351-199-56151-3464-13765-219
Cash Flow from Disc. Op. 00260000000
Stock Based Compensation 0000000000
Cash Flow from Others 441-648472-30131113283-432164
Cash Flow from Operations 1,9433,0933,9844,0274,1973,6123,7793,6533,8453,818

ABB Ltd Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
NetIncomeFromContinuingOperations 562668773715581627607240528443
CF_DDA 333333322317295293284288280287
ChangeInWorkingCapital -906-7298804-876-2522011,585-610424
CF_DeferredTax -13-3503131-50-7-19315-142
Cash Flow from Disc. Op. 0000000000
Stock Based Compensation 0000000000
Cash Flow from Others -21-103-274-3422-2088743970
Cash Flow from Operations -458881,1691,833535981,1731,9942521,082
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