The majority of ASX small caps are not profitable, or may not even be making money – even ones that have gained 11,000 per cent in 10 years.

But some are profitable. Here is one metric by which you can detect not only if a company is making money but how efficient it is with cash.

This metric is not just a simple profit or loss, it accounts specifically for cash flow from operations. It is commonly used by analysts and investors to value a company.

According to Bloomberg these ASX small caps had the highest “free cash flow” last year.

Code Name FCF 2018 FY Price (26-Jul) YTD % Return P/E Ratio Market Cap
KSL KINA SECURITIES LTD 322.80M $1.43 56.7 11.81 233.69M
TBR TRIBUNE RESOURCES LTD 255.73M $7.02 81.59 5.29 405.17M
AMI AURELIA METALS LTD 134.38M $0.44 -29.41 3.57 416.58M
RND RAND MINING LTD 103.67M $3.30 63.68 2.21 197.89M
ATL APOLLO TOURISM & LEISURE LTD 95.91M $0.43 -58.79 4.53 83.77M
MYR MYER HOLDINGS LTD 86.49M $0.55 31.33 15.89 447.60M
CLH COLLECTION HOUSE LTD 79.44M $1.24 -5.28 6.44 174.10M
GRR GRANGE RESOURCES LTD 77.31M $0.26 37.5 2.7 306.69M
SST STEAMSHIPS TRADING COMPANY 68.12M $15.90 -12.48 59.32 493.03M
MYS MYSTATE LTD 46.95M $4.68 5.49 14.03 423.34M
MAH MACMAHON HOLDINGS LTD 44.09M $0.18 -13.95 8.29 398.67M
AGI AINSWORTH GAME TECHNOLOGY LT 42.00M $0.74 -8.81 6.85 244.18M
LAU LINDSAY AUSTRALIA LTD 36.91M $0.33 -10.73 11.8 99.45M
ALK ALKANE RESOURCES LTD 34.97M $0.41 107.69 8.83 204.97M
NBL NONI B LTD 34.89M $2.64 -0.22 15.95 255.86M
PNC PIONEER CREDIT LTD 33.70M $2.39 -15.8 9.75 150.06M
RHL RURALCO HOLDINGS LTD 32.96M $4.22 41.27 17.97 442.27M
BFG BELL FINANCIAL GROUP LTD 32.93M $1.00 22.16 11.75 317.54M
HZN HORIZON OIL LTD 31.99M $0.11 15 3.87 149.73M
VLW VILLA WORLD LTD 31.83M $2.34 38.1 6.75 291.62M
KSC K & S CORP LTD 30.87M $1.76 27.32 9.86 224.01M

Those with the most cash

The highest was PNG-bank Kina Securities (ASX: KSL). Not entirely surprising; it is a bank after all.

But here’s an interesting thing – the next three stocks are miners.

The majority of ASX small cap miners are at the surveying or exploration stage rather than the production phase. But Rand Mining (ASX: RDN), Aurelia Metals (ASX: AMI) and Tribune Resources (ASX: TBR) are making money.

Two of these, Rand and Tribune, are business partners – they part-own a gold mine in Western Australia with Northern Star Resources (ASX: NST).

Tribune had that much spare cash it decided to pay a special dividend of $3.50 per share last year. That’s more than the big four banks.

Aurelia Metals is also a gold miner (as well as base metals), but based in New South Wales. It went from explorer to producer through the April 2018 acquisition of Peak Mines.

The next stock is Apollo Tourism and Leisure (ASX: ATL), a stock that is profitable, but possibly facing a less rosy financial year this year. The company has fallen over 70 per cent with a downturn in the tourist market.

Following Apollo is Myer (ASX: MYR). Myer has fluctuated but currently sits slightly higher than a year ago. But it is one of the stocks worst affected by the rise of online retail.

Another notable stock on this list is Bell Financial Group (ASX: BFG) which owns stockbroker Bell Potter and broking platform Bell Direct.

Earnings per share

Stockhead has also observed the P/E ratios of these companies. As these are all profitable this ratio is able to be calculated and is relevant.

However, the ratio among these companies varies from 2.2, in the case of Rand Mining to a staggering 59 for Streamships Trading Company (ASX: SST).

However, the latter is an industrial stock and has a relatively low amount of shares (30 million). It is a business conglomerate with interests in Australia and PNG, particularly in… you guessed it, steamships.

Read More: Here’s a small-cap investing expert on how to use the P/E ratio when evaluating companies