What is the gross operating cash flow?

Definition

Gross operating cash flow corresponds to the cash generated by the company's operations, i.e. before taking into account the impact of investments and financing (including corporation tax).

Interpretation

This cash flow must be positive and sufficient to allow you to renew your productive equipment, otherwise your business model is not viable.

It must also allow you to honour your monthly loan payments, otherwise your financial structure is not viable.

Calculation

Gross operating cash flow is calculated by subtracting the change in working capital from the EBITDA.