Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and free cash flow decreased compared to the prior quarter and the same quarter last year, but free cash flow margin improved. The quarter's cash conversion strengthened as a higher proportion of revenue was converted into free cash flow despite lower top-line and increased capital spending.
- Revenue declined sequentially and year-over-year, while operating cash flow also decreased. Capital expenditure rose compared to the prior quarter but fell from a year ago. Free cash flow was lower in both comparisons, but the free cash flow margin improved, indicating a higher conversion rate of revenue into free cash flow.
- Compared to the preceding quarter, revenue and free cash flow were lower, while free cash flow margin was higher. Compared to the same quarter one year earlier, all metrics were lower except for free cash flow margin, which was higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
$471.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$618.0M
Cash generated by operations before capital spending.
CapEx
$147.0M
Capital spending and related asset purchases.
FCF margin
37.0%
The share of revenue converted into free cash flow.
Cash flow trend
A short quarterly history shows whether FCF is scaling with revenue or only spiking for one period.
| Period | Revenue | Operating CF | CapEx | FCF | FCF margin |
|---|---|---|---|---|---|
| 2022-12-31 | $2.6B | $585.0M | $134.0M | $451.0M | 17.3% |
| 2023-03-31 | $2.0B | $947.0M | $69.0M | $878.0M | 43.6% |
| 2023-06-30 | $1.8B | $712.0M | $95.0M | $617.0M | 34.8% |
| 2023-09-30 | $1.3B | $618.0M | $147.0M | $471.0M | 37.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 204.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 11.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | n/a | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Improved Free Cash Flow Margin
The free cash flow margin increased compared to both the prior quarter and the same quarter last year, despite lower revenue and free cash flow. This indicates a higher efficiency in converting revenue into free cash flow during the quarter.
This improvement in margin strengthened the company's cash generation capability relative to its revenue base.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue declined sequentially and year-over-year, while operating cash flow also decreased. Capital expenditure rose compared to the prior quarter but fell from a year ago. Free cash flow was lower in both comparisons, but the free cash flow margin improved, indicating a higher conversion rate of revenue into free cash flow.
Compared to the preceding quarter, revenue and free cash flow were lower, while free cash flow margin was higher. Compared to the same quarter one year earlier, all metrics were lower except for free cash flow margin, which was higher.
The filing discusses risks related to the proposed transaction with Incitec Pivot Limited, including regulatory approvals and the integration of the Waggaman ammonia production complex, which may affect future operations and capital allocation.