Glossary

Cash flow per share

Cash flow can be regarded as the volume of cash, generated by the trading operations of the business out of which the ordinary dividend must be funded.Cash flow per share = Cash flow (£)/weighted average no. shares in issue.
Where:
Cash flow = Net cash inflow from operating activities + returns on investment - Servicing of financing – taxation.
And:
Operating profit = Depreciation charges + asset write downs + net increase in provisions - share of associates profits (net) - profits (net of losses) on asset disposals - currency translation profits (net) - net increase in stocks - net increase in debtors + net increase in creditors.
And:
Returns on investments = interest received + dividends received from associates + other investment receipts.
And:
Servicing of finance (except dividends paid to ordinary shareholders) = interest paid - dividends paid to preference shareholders - dividends paid to minority prefs.

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