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Yes. So if they have the exact same performance in FY18 as FY17,...

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aricho

248 Posts.

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23/08/17

16:56

Post #: 26701614
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Originally posted by bug1 ↑

Some details from p21,22 from financial statements;
-----
Other changes in networking capital primarily related to a large payables and accruals unwind.

Underlying net working capital movement
Trade debtors 8.3
Prepayments (14.7)
Inventory (0.1)
Trade and other payables 58.7
Provisions 34.5
Other 4.2
Total other change in NWC 90.9
-----

The way i understand Working Capital, its like say keeping $1000 in your savings account to pay bills, as long you keep it as $1000 you arent out of pocket each payday. But if one payday you decide you you want keep it at $1500 because you have a bit bill coming up, then you are out of pocket $500 that pay. If they reduced it to $800, then they have an extra $200 that pay period.

In this case Vocus increased how much they have saved up by $90.9m, so they have less cashflow this FY, they are saving up. If they dont decide to change anything next FY they aren't out of pocket, so $0 change in the NWC.

(or do i have it wrong?)

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Yes. So if they have the exact same performance in FY18 as FY17, but net working capital stays the same, then cash flow would improve by $90.9m

VOC Price at posting: $2.64 Sentiment: Buy Disclosure: Held
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0 Great analysis

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