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Baker Hughes Inc (NYSE:BHI)
Cash Flow from Operations
$2,953 Mil (TTM As of Dec. 2014)

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 Dec. 2014, Baker Hughes Inc's Net Income From Continuing Operations was $667 Mil. Its DDA was $468 Mil. Its Change In Working Capital was $267 Mil. Its cash flow from deferred tax was $-70 Mil. Its Cash Flow from Discontinued Operations was $0 Mil. Its Stock Based Compensation was $122 Mil. And its Cash Flow from Others was $-255 Mil. In all, Baker Hughes Inc's Cash Flow from Operations for the three months ended in Dec. 2014 was $1,199 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.

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

Baker Hughes Inc's Cash Flow from Operations for the quarter that ended in Dec. 2014 is

Baker Hughes Inc Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2014 was 303 (Mar. 2014 ) + 393 (Jun. 2014 ) + 1058 (Sep. 2014 ) + 1199 (Dec. 2014 ) = $2,953 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.

Baker Hughes Inc's net income from continuing operations for the three months ended in Dec. 2014 was $667 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

Baker Hughes Inc's depreciation, depletion and amortization for the three months ended in Dec. 2014 was $468 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.

Baker Hughes Inc's change in working capital for the three months ended in Dec. 2014 was $267 Mil. It means Baker Hughes Inc's working capital increased by $267 Mil from Sep. 2014 to Dec. 2014 .

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

Baker Hughes Inc's cash flow from deferred tax for the three months ended in Dec. 2014 was $-70 Mil.

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

Baker Hughes Inc's cash flow from discontinued operations for the three months ended in Dec. 2014 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.

Baker Hughes Inc's stock based compensation for the three months ended in Dec. 2014 was $122 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).

Baker Hughes Inc's cash flow from others for the three months ended in Dec. 2014 was $-255 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.

Baker Hughes Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
NetIncomeFromContinuingOperations 8742,3991,5141,6354218191,7431,3171,1031,731
CF_DDA 3844295166377111,0691,3211,5681,6981,814
ChangeInWorkingCapital -169-1,104-413-478251-812-1,414-771472-287
CF_DeferredTax 778-40-256-188-492-1141-70
Cash Flow from Disc. Op. 0000000000
Stock Based Compensation 000608887108115115122
Cash Flow from Others -142-1,211-139-24024-119241-280-228-357
Cash Flow from Operations 9555901,4751,6141,2398561,5071,8353,1612,953

Baker Hughes Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
NetIncomeFromContinuingOperations 284215268245340250336359369667
CF_DDA 408417415424423436437454455468
ChangeInWorkingCapital 150316-294127263376-437-405288267
CF_DeferredTax 0-1140001000-70
Cash Flow from Disc. Op. 0000000000
Stock Based Compensation 0115000115000122
Cash Flow from Others -19-61-3-10454-175-33-15-54-255
Cash Flow from Operations 8238883866921,0801,0033033931,0581,199
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