Capital expenditure (Capex)

Capex is short for capital expenditure. This is simply the purchase of fixed assets such as land, buildings and equipment for a business and it is often one of the biggest uses for a company’s cash flow.

Capex is short for capital expenditure. This is simply thepurchase of fixed assets such as land, buildings and equipmentfor a business and it is often one of the biggest uses for acompany's cash flow. Capex is usually split into two parts.

Maintenance capex refers to the money that is spent onreplacing worn out assets or bringing existing ones up to date.

Expansionary capex refers to any investment in new capacitydesigned to grow the sales and profits of the business.

The keypoint about capex is that a company has to get a good returnon the money it spends. Spending too much capex on poorprojects that deliver weak returns

Most Popular

Is it cheaper to leave the heating on low all day?
Personal finance

Is it cheaper to leave the heating on low all day?

The weather is getting colder and energy bills are rising, but is it really cheaper to leave the heating on low all day or should you only turn it on …
1 Dec 2022
Radiator vs electric heater – which is cheaper?
Personal finance

Radiator vs electric heater – which is cheaper?

We compare the costs, pros and cons of radiators and electric heaters and see which one will help keep your energy bill as low as possible.
28 Nov 2022
State pension errors – why tens of thousands of mothers could be missing out on millions in state pension payments
State pensions

State pension errors – why tens of thousands of mothers could be missing out on millions in state pension payments

LCP launches Mothers Missing Millions campaign amid DWP state pension errors.
3 Dec 2022