Cash Flow Trends

Cenovus | 2011 | 2012 | 2013 |

Net income | 1,478 | 995 | 662 |

Cash flow from operations(CFO) | 3,273 | 3,420 | 3,539 |

Capital expenditures | 2,792 | 3,449 | 3,269 |

Exploration&Valuation Assets | 527 | 654 | 331 |

Property&Plant&Equipment | 2,265 | 2,795 | 2,938 |

Dividends | 603 | 665 | 732 |

Net borrowings | (9) | 1,222 | (19) |

Net issuance(repayment) of short term borrowing | (9) | 3 | (8) |

Issuance of US unsecured notes | 0 | 1,219 | 814 |

Repayment of US unsecured notes | 0 | 0 | (825) |

CFO-NI | 1,795 | 2,425 | 2,877 |

CFO-CapEx | 481 | -29 | 270 |

CFO-（CapEx+Dividends） | -122 | -694 | -462 |

Crescent | 2011 | 2012 | 2013 |

Net income | 201 | 191 | 145 |

Cash flow from operations(CFO) | 1,323 | 1,544 | 1,973 |

Capital expenditures | 1,458 | 3,365 | 1,874 |

Development capital and other expenditures | 1,252 | 1,509 | 1,747 |

Capital acuisitions | 206 | 1,856 | 127 |

Cash Dividends | 314 | 367 | 422 |

Net borrowings | 78 | 149 | 199 |

CFO-NI | 1,122 | 1,353 | 1,828 |

CFO-CapEx | -135 | -1,821 | 99 |

CFO-（CapEx+Dividends） | -450 | -2,188 | -323 |

Trends in Net income, CFO, CapEx, Dividends, and Net borrowings

We can see from figure 1 and figure 2 that both Cenovus and Crescent point experienced a decrease in net income (NI) and an increase in operating cash flow (CFO) for the past three years. The annual decreasing rates of NI for Cenovus and Crescent point are 33% and 15% respectively while the annual growth rates of CFO for Cenovus and Crescent point are 4% and 22% respectively. As we know, net income is used to measure a company’s operating performance and profitability on an accrual basis while operating cash flow measures the actual money that flows in and out of the firm. Such trends of the two companies’ NI and CFO demonstrate that though the operating performances of the two companies were not satisfying, they both enhance the quality of the income...