Edra sells RDS.B 45.92: Short-term debt is generally payable within 12 months and its repayment is outside of operating cashflow.

So, we intend to prioritize debt payment initially following completion of the combination with BG using surplus cash from operations and proceeds from asset sales to drive debt down in our target range. First, debt service, then dividends and then a balance between buybacks and capital investment. I can then work backwards from here to determine if the sources of cash are available in the business to meet the planned cash commitments. In practice, it's not a seller's market for oil and gas assets. The equity on the balance sheet stands at $178B, resulting in an excellent price-to-book of 0.9. In theory, the company could be liquidated for more than its market cap.


Lulu:
As at 30th June 2015, the value of the RDS fixed asset base was $256B.

Renda:
And we still have to consider the value of the fixed asset base.

Christena:
It's also comforting that 14% of RDS's market capitalization is available in effective cash.

James:
It gives me great comfort that RDS could pay down 50% of its long-term debt with just its net current assets.

Angeles:
The first half of 2015 was not nearly as successful, though.

Sheba:
While the income statement result for 2014 was poor, the 2014 cashflow statement result was a resounding success.

Renate:
Alongside investment realizations of $12B, RDS was able to handily spend $40B in capex, pay $9.5B in dividends, $3B on buybacks and still had change of $12.5B to send back to the net current asset position on the balance sheet.

Veronique:
The result is that nearly all profits need to be paid out to maintain the dividend.

Angeline:
Even worse, the net income margin has also deteriorated at 12.5% annually.

Mariam:
The Net Income and EPS have declined around 20% annually.

Royal Dutch Shell (NYSE:RDS.B)
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