Operating cash flow
Cash the day-to-day business actually brought in after paying suppliers, staff and taxes. Unlike profit, it is hard to dress up.
Worked example · a round-number company
Net income$500M+Non-cash costs$500M±Working capital$200M=Operating cash flow$1.2BHow to read it
↑Higher is better. Over time it should run at or above net income.
Keep in mind
- Collecting bills faster or paying suppliers later lifts it for a while without the business improving.