It is also complicated the fact that some foods are healthy in one diet, but less healthy in a different diet. January 24, 2010 by Kyith 38 Comments Investors new to dividend investing will see terms like Net Profit, EBITDA, Net Cash from Operating Activities, Free Cash Flow thrown around. When analysing whether a company for its dividend yield, your job is to access whether its main sources of business are able to consistently generate healthy cash flow to pay your dividends.
You want to assess what is a conservative dividend the company can pay under good times, bad times and neutral conditions. Knowing the definitions of these terms, where to find them to analyse them, and how to make use of them are essential to dissecting businesses generating consistent dividends. You can find the dividends paid out for the work year under the Statement of Cash Flows – Cash Flow from Financing activities. Under the Notes To The Financial Statements somewhere far far below the Statements of Cash Flow, you should find a section talking about dividends. This would include taking into account taxes paid, interest paid and received and depreciation of assets as expense. EBITDA or operating cash flow refers to the cash generated from the companies main core activities.
The difference between EBITDA and operating cash flow is that EBITDA does not take into consideration changes in working capital (your receivables, payables and inventories) and tax expense. Operating Cash Flow adds back items taken out from Net Profit (explained above) that are non cash related, or not dealing with its core business related. The reason why there is a difference is because the reporting in Singapore follows the GAAP accounting. As a dividend investor, you need to evaluate the ability of the company to come up with cold hard cash from core business, and thus evaluating whether EBITDA or Operating Cash Flow is healthy is important. To learn more about accrual accounting versus cash accounting, you can read this article here. Things to watch out is where the operating cash flow gets bumped up massively because the company uses more payables which are not matched by receivables and inventories combined.
The payables are typically use for short term working purpose to balance short term financing for inventories and receivables. In the case of starhub the EBITDA and Operating Cash Flow is pretty close, indicating little use of working capital since there are limited inventories for telecom goods and services.
Depreciation and amortization is a GAAP accounting concept to expense assets such as plant, property and equipments used to produce goods and services according to their useful life. The Dividends received from them is such that is almost equivalent to the operating cash flow.
So we have Net Income, EBITDA and Operating Cash Flow, why do we need to calculate Free Cash Flow?
We need that because Operating Cash Flow do not factor in the capital expenditure requires to maintain the plant, properties and intangible assets required to continue generate goods and services.
To know more why this is a pretty appealing cash flow you can read Geoff Gannon’s post here. The capital expenditures are recorded in the Statement of Cash Flows, under the Cash Flows From Investing Activities. For large company like SPH, their investing section is littered with capital expenditure for maintenance as well as investments.
While Free Cash Flow takes into consideration many things, it still misses out on Interest Expense and Dividends and Earnings from Joint Venture explained above. For highly leverage companies, their interest expense is substantial, and it reduces the amount that is left over to pay for dividends.
For some companies, such as SIA Engineering and SPH, dividends from investments can be substantial and forms a long term holding in their business model that you need to consider them as positive cash flow. I tend to look at capital expenditure as 2 kinds, the part that maintains current growth (maintenance) and the part that provides incremental growth (investments). The maintenance capital expenditure is to offset depreciation of current equipment to ensure long term serviceability to produce the current level of goods and services. The investment capital expenditure is a business decision undertaken to ensure the company take advantage of opportunities and strength to expand. For such investments, leverage and cash calls can be logical financing methods to fund growth. Thus, as dividend investor, to ascertain the sustainability of dividend payout over a period of time, we usually factor in the maintenance portion of capital expenditure.
So now that we explain the definitions, formula and where to find them in the annual report, lets relate to them. The Free Cash Flow is the safest published measure of whether in a work year, whether a company like SPH is paying within their means. Different companies have different capital management structure based on the stage of growth and the nature of the business. There are many business trusts such as HPH, MIIF or CMPacific who pays out or has underlying assets that pay out of depreciation. In the case of SPH here, you see that the Maintenance Capital Expenditure more or less matches that of Depreciation. Properties and plants will eventually wear and tear and need replacements, and concessions to operate will expire. Some companies know that investors like high yield, so they pay out and roll over debts or interests. This eventually becomes a burden on the share holders as they need to bail the company out or they get a much smaller dividend in the future.
Analysing the business nature and cash flow & income growth will tells us a bit or two on whether the cash flow in the future will grow. The best is that there are visible figures showing good business model translating to consistent growing cash flows. Factoring competition, opportunities and potential substitutes, how will it affect the cash flow?
At the end of the day we are cash flow investors, and we invest in sustainable growing cash flows. I don’t know how you calculate free cashflow by taking away the cashflow from property investments.
So I do not agree with your analysis and why don’t you put down the number and lets see why the diff. I think the operating cash flow should not be $696.2 million as there is no deduction of taxes. For REITs, if we would like to calculate the Cash management value, what makes up Maintenance Capex?


Having said that, I will urge readers to exercise practical evaluation specific to different business. The reason for this question is that when i include Capex on Investment Properties into the calculation of Maintenance Capex, i usually arrive at cash management value that is lower than the dividends issued. I think I won’t be doing one for reits as what they use is actually funds from operation which is actually free cash flow. Hi Casey, its good that you are trying to practice, but its bad you chose a complex one haha! You do not have to include the 2 mentioned, but on the positive ones you need to include from the investing section, dividends from subsidiaries, subsidy income. Unhealthy people can grow healthier with the right care and attention in a healthy environment. So…how can you tell early on that the person you’re dealing with might be that person?
And if, after watching them for a few months (true character is revealed over time) you realize you’re wrong (which I have been), then you can invite them to get involved.
Carey Nieuwhof is founding pastor of Connexus Church and is author of several best-selling books, including his latest #1 best-selling work, Lasting Impact: 7 Powerful Conversations That Will Help Your Church Grow.
Carey speaks to church leaders around the world about leadership, change and personal growth. Toxic baggage resulting from abuse (especially sexual abuse) is particularly dangerous to a worship team. I wish that more pastors would recognize that ambition is counter to the Christian paradigm and that an excessive desire to be on the team is actually a form of coveting. So here is my question – what recommendations would you give on a) how to communicate to the congregation that them holding on to this couple is continuing to cause turmoil, or is this even the right approach? Direction, experience and feedback from those that have gone through this would be greatly appreciated. Would love your feedback on my above post of what your experience was with your pastor who brought you into healing. If they seem to have a lot of stories about old ministry partners who blew them off, run fast and run far. Overall great article and I know first hand what it’s like dealing with toxic people. Carey, thank you for taking the time out of your busy schedule to share your wisdom and experience to help other pastors and church leaders. The thing is, when you realize that someone is toxic, how do you extricate yourself from them? So having just finished a Family to Family course by NAMI on helping family members cope with mental illness of a loved one I’m struck by the correlation between symptoms you describe of a toxic person with those that struggle with (often undiagnosed!) brain disease. I’m not sure she was making a distinction, I think she was talking about correlation.
I would say this was the best blog post ever and ask you to meet for coffee but I don’t want to appear toxic!!
I appreciate the sentiment, but he really did treat the toxic Pharisees differently than he treated outsiders.
Admittedly, from an outside point of view there is a fine line between a controlling and selfish leader and a cautious one who protects the congregation our Father called him to lead from toxic persons. Giving excessive advice from the first meeting is rude, yes, but maybe those people just search for ways to make improvements and make a difference in the world. Wow … how could anyone think of gods children this way … does not the bible say to love one another and to hate the sin but love the sinner ?? Avoid foods with the longest shelf life - these are foods that 'live things can't live on'.
If you can buy organic food or food coming directly from a farm that uses healthy farming practices (for most people living in cities this is difficult to do), you are better off than those who buy regular food from a grocery store. For a company to pay dividends it has to make use of its assets to earn income or cash flow. You invest your cash in the company, the company goes out to buy assets that produce revenue after cost. The net income will be use as a basis to calculate the EBITDA and overall cash flow which we will explain later.
Essentially this calculates the cold hard cash the main business brings in, which the management can user to carry out certain business decisions.
Note that the depreciation and amortization and finance costs are added back to form the EBITDA. SIA Engineering engages in many joint ventures and the gem of it is that these joint ventures generate a sizable cash flow. For such companies, to calculate whether the cash flow produce by the business can sustain the dividends, I would factor in this to my dividend sustainability computation. This is the cash flow statement – investing activities section of Singapore Press Holdings (SPH).
It will be great that the plant, equipment, concessions mentioned in Depreciation and Amortization can go on forever!
If a company produces a certain amount of cash during the year, how much would the owner need to send back to that company’s management for them to keep sales, profits, etc.
It also consists of dividends received from investments, short term or long term investments bought or sold. It is viewed as mandatory and likely recurring in effective operations and there fore should be part of Free Cash Flow calculations.
As mentioned in Free Cash Flow, this still misses out on the earnings from Investments, Joint Venture and Subsidiaries as well as Interest on Debt. While we expect that in some years dividend payout is larger than the cash inflow from business, they should largely be inline. They get into trouble when credit becomes difficult to get and they have problems refinancing, or have to refinance at a very expensive interest rate. From the chart above, SPH paid off 320 mil utilizing its excess cash from businesses and its cash holdings. Do not use only one year because you may have just analyse a year where the business did exceptionally well. To make sense of the cash flow of the business is imperative not just in Dividend Investing but general Fundamental Analysis.
Which mean it doesn’t matter how one count them, SPH is generating free cashflow consistently.
Purely based on how you can polish up existing equipment or replacing them so that you can be an ongoing entity.


If a company is unique in that the always need to purchase something under a different line item every year so that they can produce at the same level, then that should be included as well. With regards to the business of REITs, would you then include CAPEX on investment properties in maintenance capex? Would you be able to extend the working copy (in excel format) of your singapore dividend stock tracker to me? In addition to writing one of the mostly widely read Christian leadership blogs in the world, Carey hosts the top-rated Carey Nieuwhof Leadership Podcast where he interviews some of today’s best leaders. I also have noticed that people who are extremely forceful in the beginning often cause immense problems quickly. The stage is like a magnet for these folks and they are often being run by dark forces despite being redeemed. Attraction and promotion of church followers while trying to serve each other sure can be problematic when there are some people in attendance who are feeling unstable and acting out. Just working through what a compassionate response looks like within the church (or, as you point out in this case, between churches!) Stigma produced by mental illness is a huge issue. I know that people from different cultures, families, heritages, etc have different ways of doing things, behaving and expressing themselves.
Spirit-filled people are sometimes quite willing to reveal themselves honestly, and fearless about rejection, because they know that others who are distrustful and protecting personal secrets will often reveal those problems more readily (and without being aware of it) as they project bad motives onto a friendly and open Christian, rather than risk the possibility that love may actually beget love.
You want to eat meat from animals that have not been fed antibiotics and that have not been injected with hormones. Some people evaluate based on profit before taxation while others take into consideration the taxes.
SPH’s stake in M1 and Starhub generates recurring dividends to the tune of an average 40 mil per year. We take you through how to compute the free cash flow and assess whether the cash flow covers the dividend.
Since SPH dividend payments range from 195M to 433M, what I see is consistently POSITIVE operating cashflow.
It may be different for much business but usually i would take purchase of plant and equipment. Since their nature of business is fundamentally different from companies providing services and goods.
However, there was one part which I realised that FCF was negative but they still gave out dividends and even increased the payout ratio. In my experience as a pastor, the people who show up and want to make it headline news are rarely (I’m being generous here) healthy people.
Whether it’s a casual conversation or even a job interview, people who tell 15 ways you can improve your organization or your speaking often end up being toxic people.
Often a toxic person, because they want to be the centre of attention, will try to get on your calendar soon. One thing that I noticed in your article is that you didn’t really discuss the roots of the toxic behavior. For those on the outside, this probably sounds strange but think of it like an addiction and it will make sense.
When you walk away from a conversation feeling condemned… Especially if you revealed something sensitive. Reaching out to these brothers and sisters is uncomfortable and potentially divisive I’d like to learn more about how that can be addressed between believers in a way that cares for each member of the Body while promoting unity. This is a very helpful post Carey, thanks for being prepared to put time into these posts to help us learn. While advice-giving may be a bit forward and presumptuous, expecting everybody to hang back for months is perhaps instead sending the message that you actually want people to remain in hiding, instead of showing up as their true selves. The problem is that if the person trying to help is not humble they can cause more harm than good and actually push people away from the church.
These by no means describe people with bad motives because personalities have absolutely nothing to do with motives. There are just as many toxic people with every trait on this list as with no trait on the list because they’re not related whatsoever. Many foods can cause illness if you don't consume enough, and opposing illnesses when you consume them in excess. What’s perplexing is that the people who end up being the most toxic at the end of the relationship are over-the-top positive when they first meet you.
But in a healthy human relationship, we reserve opinions about others until we are asked the share them.Toxic people rarely do. I think it would be beneficial to talk about two types which are especially dangerous and some behaviors that are often not recognized as sinful.
It mystifies me why a person would want to work under a leader that they didn’t fundamentally respect?
You obviously have the absence of experience in that I mean haven’t come from an abusive, fearful, unloved, abandoned, lonely,painful environment . When the other person wants to change the conversation when it bothers them and you oblige them but they don’t show you the same courtesy when you ask to move on from a subject.
This article is just a bunch of different traits of personalities that are assumed to correlate whatsoever with the person’s intentions. Also, I recognize some of the ways I can tend toward one or two of the characteristics you mentioned. I wouldn’t let a toxic person on our team, and if they got on, it would have to end quickly but gracefully. Those of us who have been called into a leadership role have a responsibility to make wise dicisions (sometimes difficult and not popular with the masses) that we are held responsible for. If someone is telling you things all the time and never waits to be asked, it’s a sign of toxicity.
They have the humility to be obscure for a while, and to serve rather than to want to be served. Also, note that this behavior is divisive and it served to split the relationship between the worship leader and the pastor. I see that I often approach people out of desperation or a scarcity mentality rather than trusting and waiting for the right thing to happen, for God to draw us together or apart. When people I first meet start telling me about all the ways we can improve our church, I thank them and tell them point blank we’re probably not the church for them and offer to help them find a new one.



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