Net free cash flow represents the cash a company generates after accounting for cash outflows to support operations, maintain its capital assets and maintaining the current level of dividend distribution. Unlike earnings or net income, free cash flow is a measure of profitability that excludes the non-cash expenses of the income statement and includes spending on equipment and assets as well as changes in working capital from the balance sheet. It is calculated as cash from operations less capital expenditures less dividends paid.
Net Free cash flow represents the cash flow available for the company to repay creditors or increase dividends.
Formula:
OperCashFl - CapEx - DivPaid