The objective of this blog is to analyze the Statement of Cash flows for Telecom Corporation of New Zealand Limited (TEL) and Telstra Corporation Limited (TLS) from operating activities, investing activities and financing activities. The statements are as follows:
TEL
Net cash from operating activities increased in 2010 by NZ$210 million, or 13.5%, to NZ$1,761 million. This was due to the reduction in payments to suppliers and employees of NZ$577 million more than offsetting the NZ$395 million reduction in cash received from customers.
The net cash outflow on investing activities of NZ$1,091 million in 2010 was NZ$191 million, or 14.9%, lower than the NZ$1,282 million outflow in 2009 due to reductions in payments for property, plant and equipment and intangible assets (capital expenditure).
Net cash outflow from financing activities decreased by NZ$1,156 million in 2009 to NZ$880 million as Telecom paid NZ$1,178 million in relation to capital repurchased in 2008 without a similar repurchase in 2009.
TLS
Net cash from operating activities increased by $693 million or 7.7% mainly driven by lower income tax payments this fiscal year. This was due to a lower PAYG installment rate and prior year income tax return refunds received.
There was a reduction in capital expenditure before investments, falling by $1,199 million or 25.0% as we moved to completion and maintenance of the major program of work. However we continue to invest in the network and other assets, with $3,595 million spent on capital works this fiscal year.
During fiscal 2010, TLS repaid $954 million of net borrowings and finance lease repayments including $1,350 million of domestic bank loans and $1,298 million of Euro and other denominated offshore borrowings. This long term debt issuance was used to reduce net borrowings post the peak of the global economic crisis.
(294 Words)
References
Telstra. (2010). Annual Report 2010. Retrieved from
http://www.telstra.com.au/abouttelstra/download/document/tls749-annual-report-2010.pdf
CompanyResearch. (2010). Telecom Corporation of New Zealand Limited. Retrieved from
http://companyresearch.nzx.com.libproxy.unitec.ac.nz/deep_ar/newpage.php?pageid=arep&default=TEL
My share portfolio is as follows:
|
Symbol |
Description |
Qty |
Cost Basis |
Price |
Curr Value |
P/L |
% |
Action |
| TEL | Telecom Corpora… | 5000 | 2.735 | 2.580 | 12,900.00 | -775.00 | -5.67% | Close |
| TLS | Telstra Corpora… | 2500 | 3.890 | 3.830 | 9,575.00 | -150.00 | -1.54% | Close |
liux60 
Well explained and easy to understand. Seems the resignation of TEL’s CEO has significantly affected your portfolio.
good work
The author used some charts and cash flow statement to analyse two companies’ different activities including operating, investing and financing. The only fly in the ointment is the brief summary of favourable and unfavourable factors that the author discussed.