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CIMIC Group Limited Annual Report 2016 |
Operating and Financial Review
CASH FLOW
Cash flows from operating activities
$m
2016
2015
chg. $
chg. %
Cash flows from operating activities
1,201.4
1,919.6
(718.2)
(37.4)%
Interest, finance costs, taxes and dividends received
(74.4)
(469.4)
395.0
(84.1)%
Net cash from operating activities
1,127.0
1,450.2
(323.2)
(22.3)%
Gross capital expenditure
(280.2)
(266.3)
(13.9)
5.2%
Free operating cash flow
846.8
1,183.9
(337.1)
(28.5)%
Cash flows from investing activities
$m
2016
2015
chg. $
chg. %
Payments for intangibles
(14.7)
(15.2)
0.5
(3.3)%
Payments for property, plant and equipment
(280.2)
(266.3)
(13.9)
5.2%
Proceeds from sale of property, plant and equipment
97.8
156.2
(58.4)
(37.4)%
Proceeds from sale of investments in controlled entities and
businesses
-
1,671.0
(1,671.0)
-
Proceeds from sale of equity accounted investments
180.8
-
180.8
-
Cash acquired from acquisition of investments in controlled
entities and businesses
244.4
-
244.4
-
Income tax paid in relations to proceeds from sale of
investments in controlled entities and businesses
(32.0)
(263.0)
231.0
(87.8)%
Payments for investments
(325.1)
(35.1)
(290.0)
826.2%
Loans to associates and joint ventures
(152.7)
-
(152.7)
-
Net cash from investing activities
(281.7)
1,247.6
(1,529.3)
(122.6)%
Cash flows from financing activities
$m
2016
2015
chg. $
chg. %
Own shares purchased from shareholders of the Company
(425.9)
-
(425.9)
-
Cash payments in relation to employee share plans
(18.8)
(4.1)
(14.7)
358.5%
Proceeds from borrowings
380.4
871.2
(490.8)
(56.3)%
Repayment of borrowings
(380.1)
(2,915.4)
2,535.3
(87.0)%
Repayment of finance leases
(276.9)
(124.7)
(152.2)
122.1%
Dividends paid to non-controlling interests
(12.6)
-
(12.6)
-
Dividends paid to shareholders of the Company
(320.5)
(385.9)
65.4
(16.9)%
Payments to acquire non-controlling interests
(389.0)
-
(389.0)
-
Net cash from financing activities
(1,443.4)
(2,558.9)
1,115.5
(43.6)%
From operating activities
Cash flows from operating activites were $1.2 billion for FY16. FY16 showed a strong level of cash flow generation from operating
activities, a result of CIMIC’s continued focus on working capital management. EBITDA conversion was 110% in FY16. FY15 cashflows from
operating activities were boosted by property sales and the initial benefits of CIMIC’s working capital management strategy.
Free operating cash flow was $846.8 million for FY16. Income taxes paid have decreased by $294.0 million. The significant reduction in
the amount of taxes paid is primarily due to the timing of payments of taxes and receipt of refunds outside of the financial year to which
they relate. Finance costs have reduced due to the Group’s improved financial structure and lower cost of debt. Gross capital expenditure
was $280.2 million for FY16, an increase of 5.2%, or $13.9 million, compared to FY15. The increase was due in part to capital expenditure
on job-costed tunnelling machines for new projects, as well as the fit-out of 177 Pacific Highway, North Sydney.
From investing activities
Net cash outflows from investing activities were $281.7 million for FY16. This compares to an inflow of $1.2 billion in FY15. The significant
cash flows for FY16 included the net impact of the purchase of shares in UGL and Sedgman, $152.7 million loans to associates and joint
ventures, offset in part by $180.8 million proceeds from the divestment of Nextgen. FY15 included $1.7 billion of proceeds from the sale
of John Holland and 50% of Ventia, less $263.0 million of income tax paid in relation to proceeds received from the sale of these
investments.
From financing activities
Net cash outflows from financing activities were $1.4 billion for FY16 compared to $2.6 billion in FY15. The FY16 financing cash flows
include $425.9 million invested in the share buy-back, and payments for the acquisition of shares in UGL, Sedgman and Devine.
FY16 also included a $276.9 million repayment of finance leases. In FY15, the cash outflows from financing activities included the net
repayment of $2.0 billion in relation to interest bearing liabilities. This included the repurchase of 10-Year Fixed-Rate Guaranteed Senior
Notes, the repayment of other Guaranteed Senior Notes, and other bilateral, syndicated and other unsecured loans. (Refer to Financial
Report, ‘Note 19: Interest bearing liabilities’).
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