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Diageo PLC (NYSE:DEO)
Cash Flow from Operations
$3,029 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 six months ended in Dec. 2014, Diageo PLC's Net Income From Continuing Operations was $2,135 Mil. Its DDA was $297 Mil. Its Change In Working Capital was $-746 Mil. Its cash flow from deferred tax was $0 Mil. Its Cash Flow from Discontinued Operations was $0 Mil. Its Stock Based Compensation was $0 Mil. And its Cash Flow from Others was $-188 Mil. In all, Diageo PLC's Cash Flow from Operations for the six months ended in Dec. 2014 was $1,498 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.

Diageo PLC's Cash Flow from Operations for the fiscal year that ended in Jun. 2014 is calculated as:

Diageo PLC's Cash Flow from Operations for the quarter that ended in Dec. 2014 is

For company reported semi-annually, GuruFocus uses latest annual data as the TTM data. Diageo PLC Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2014 was $3,029 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.

Diageo PLC's net income from continuing operations for the six months ended in Dec. 2014 was $2,135 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

Diageo PLC's depreciation, depletion and amortization for the six months ended in Dec. 2014 was $297 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.

Diageo PLC's change in working capital for the six months ended in Dec. 2014 was $-746 Mil. It means Diageo PLC's working capital declined by $746 Mil from Jun. 2014 to Dec. 2014 .

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

Diageo PLC's cash flow from deferred tax for the six months ended in Dec. 2014 was $0 Mil.

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

Diageo PLC's cash flow from discontinued operations for the six 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.

Diageo PLC's stock based compensation for the six months ended in Dec. 2014 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).

Diageo PLC's cash flow from others for the six months ended in Dec. 2014 was $-188 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.

Diageo PLC Annual Data

Jun05Jun06Jun07Jun08Jun09Jun10Jun11Jun12Jun13Jun14
NetIncomeFromContinuingOperations 2,5393,6273,0933,1382,7922,5753,2693,2403,9473,831
CF_DDA 4373954184584915495716396161,064
ChangeInWorkingCapital 161-354-357-554-414493-178-823-854-1,010
CF_DeferredTax 0000000000
Cash Flow from Disc. Op. 0000000000
Stock Based Compensation 0000000000
Cash Flow from Others -6-7247924-219-223-123199-562-856
Cash Flow from Operations 3,1322,9443,2323,0652,6503,3943,5383,2553,1473,029

Diageo PLC Semi-Annual Data

Jun10Dec10Jun11Dec11Jun12Dec12Jun13Dec13Jun14Dec14
NetIncomeFromContinuingOperations 2,5751,9663,2691,5903,2402,5483,9472,8583,8312,135
CF_DDA 5492255712626392586163041,064297
ChangeInWorkingCapital 493-794-178-1,133-823-1,208-854-1,494-1,010-746
CF_DeferredTax 0000000000
Cash Flow from Disc. Op. 0000000000
Stock Based Compensation 0000000000
Cash Flow from Others -22344-12352019910-562-676-856-188
Cash Flow from Operations 3,3941,4403,5381,2393,2551,6073,1479923,0291,498
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