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Capital expenditures are the funds used to acquire or upgrade a company's fixed assets, such as expenditures towards property, plant, or equipment (PP&E). [3] In the case when a capital expenditure constitutes a major financial decision for a company, the expenditure must be formalized at an annual shareholders meeting or a special meeting of the Board of Directors.
Free cash flow to firm (FCFF) is the cash flow available to all the firm's providers of capital once the firm pays all operating expenses (including taxes) and expenditures needed to support the firm's productive capacity. The providers of capital include common stockholders, bondholders, preferred stockholders, and other claimholders.
Unlevered free cash flow (i.e., cash flows before interest payments) is defined as EBITDA − CAPEX − changes in net working capital − taxes. This is the generally accepted definition. If there are mandatory repayments of debt, then some analysts utilize levered free cash flow, which is the same formula above, but less interest and ...
Capital allocation remains disciplined, with a focus on sustaining free cash flow through prudent management of capex and working capital. Finally, our team members are our greatest asset.
In addition, we landed our capex intensity at just over 10% in 2024 and expect to continue in and around this range for 2025. ... Working capital is another sort of key part to this.
It carried $104 billion in physical assets on its balance sheet and spent about $68.5 billion in capital expenditures (capex) since the end of 2021, mostly going toward this business segment ...
Working capital (WC) is a financial metric which represents operating liquidity available to a business, organisation, or other entity, including governmental entities. Along with fixed assets such as plant and equipment, working capital is considered a part of operating capital. Gross working capital is equal to current assets.
Capital expenditures either create cost basis or add to a preexisting cost basis and cannot be deducted in the year the taxpayer pays or incurs the expenditure. [ 3 ] In terms of its accounting treatment, an expense is recorded immediately and impacts directly the income statement of the company, reducing its net profit.