Cash conversion remains robust with an operating cash flow to net income ratio of 1.73 in 2025Q4, supporting a healthy free cash flow margin of 22.8%.
| Cash from Operations | 2.29B | 2.3B | 2.1B | 2.06B | 1.36B | 1.41B | 786M |
| Operating CF Margin % | 21.19% | 20.48% | 18.58% | 19% | 14.21% | 14.22% | 9.27% |
| Operating CF Growth % | -0.66% | 9.57% | 1.79% | 52.14% | -3.62% | 79.01% | - |
| Net Income | 1.63B | 1.44B | 1.3B | 1.12B | 1.39B | 1.18B | 687M |
| Depreciation & Amortization | 352.11M | 324M | 309M | 287M | 268M | 305M | 260M |
| Stock-Based Compensation | 0 | 102M | 88M | 78M | 59M | 63M | 58M |
| Deferred Taxes | 0 | 0 | 0 | 62M | 197M | 0 | 199M |
| Other Non-Cash Items | 52.82M | 385M | 506.04M | 336M | -406M | -157M | 43M |
| Working Capital Changes | 250.39M | 48M | -107M | 181M | -152M | 15M | -461M |
| Change in Receivables | -63.58M | -312M | 38M | -85M | 14M | 18M | -57M |
| Change in Inventory | 130.09M | 216M | -131M | -292M | -17M | 130M | 232M |
| Change in Payables | 122.26M | 0 | 112M | 387M | 41M | 140M | -256M |
| Cash from Investing | -567.29M | 528M | -134M | -8.78B | -33M | 1.03B | 291M |
| Capital Expenditures | -403.95M | -250M | -234M | -328M | -298M | -318M | -243M |
| CapEx % of Revenue | 3.74% | 2.23% | 2.07% | 3.02% | 3.12% | 3.21% | 2.87% |
| Acquisitions | -157.47M | 0 | -71M | 9.21B | 112M | 241M | 120M |
| Investments | - | - | - | - | - | - | - |
| Other Investing | 0 | 778M | 171M | -9.16B | 165M | 853M | 142M |
| Cash from Financing | -2.55B | -1.54B | -1.57B | 6.91B | -1.24B | -2.44B | -925M |
| Debt Issued (Net) | -1.28B | 592M | -553M | 9.49B | 8M | 28M | 1M |
| Equity Issued (Net) | -1000K | -1000K | -1000K | 0 | 0 | 0 | 0 |
| Dividends Paid | -598.59M | -570M | -388M | -2.68B | -1.15B | -2.37B | -1.15B |
| Share Repurchases | -639.67M | -121M | -38M | 0 | 0 | 0 | 0 |
| Other Financing | -39.12M | -1.44B | -589M | 107M | -96M | -94M | 226M |
| Net Change in Cash | -769.66M | 1.21B | 383M | 205M | 82M | -6M | 138M |
| Free Cash Flow | 1.97B | 2.05B | 1.76B | 1.74B | 1.06B | 1.09B | 543M |
| FCF Margin % | 18.27% | 18.26% | 15.61% | 15.98% | 11.08% | 11.01% | 6.4% |
| FCF Growth % | -3.91% | 16.27% | 1.67% | 63.99% | -2.85% | 100.55% | - |
| FCF per Share | 0.44 | 0.45 | 0.38 | 0.38 | 0.23 | 0.24 | 0.12 |
| FCF Conversion (FCF/Net Income) | 1.40x | 1.60x | 2.00x | 1.95x | 0.98x | 1.23x | 1.20x |
| Interest Paid | 0 | 360M | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Technical share overhang pressure
As reported in recent financial statements, Haleon's operating cash flow to net income ratio reached 1.73 in 2025Q4, indicating that the company is generating significantly more cash from its core operations than its accounting net income suggests, which points to high-quality earnings and efficient working capital management.
The consistent premium of operating cash flow over net income suggests that non-cash charges and favorable working capital movements are bolstering the company's liquidity position. Investors should monitor whether this conversion efficiency remains sustainable as the company continues to shed legacy costs and optimize its standalone operational structure.
Based on Haleon's reported figures, the free cash flow margin reached 22.8% in 2025Q4, demonstrating a robust ability to convert revenue into discretionary cash after accounting for capital expenditures, which appears to be a significant improvement from the volatility observed in the immediate post-demerger period.
This trajectory suggests that the company is successfully transitioning toward a more capital-efficient model as it focuses on its core 'Power Brands'. The ability to sustain these margins will be critical for funding ongoing deleveraging efforts and supporting the dividend policy without relying on external financing.
According to recent SEC filings, Haleon's capital expenditure to revenue ratio stood at 5.2% in 2025Q4, reflecting a disciplined approach to reinvestment that appears to balance the need for maintaining manufacturing capacity with the strategic goal of preserving cash for debt reduction and shareholder returns.
The moderate capital intensity suggests that the company is not currently engaged in aggressive capacity expansion, which may indicate a focus on optimizing existing assets rather than heavy infrastructure investment. Analysts should investigate whether this level of spending is sufficient to support long-term innovation and competitive differentiation.
As indicated by the cash flow data, Haleon utilized $208.8 million for dividends and $292.0 million for share repurchases in 2025Q4, signaling a shift toward returning capital to shareholders while simultaneously managing the debt obligations inherited from its former parent companies during the demerger process.
This deployment strategy appears to prioritize a balance between rewarding investors and strengthening the balance sheet. However, the reliance on share repurchases while the stock faces technical pressure from major shareholder exits warrants further investigation into whether these funds might be better utilized for organic growth initiatives.
Quick answers to the most common questions about buying HLN stock.
Haleon plc (HLN) generated $2.29B in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Haleon plc (HLN) generated $1.97B in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
Haleon plc (HLN) spent $403.9M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, Haleon plc (HLN) returned $598.6M to shareholders via cash dividends and spent $639.7M on share repurchases. This shows the company's commitment to returning capital to its equity investors.