In addition to comparing dividends against profits, we should inspect whether the company generated enough cash to pay its dividend. Koninklijke Brill paid out 150% of its free cash last year. Cash flows can be lumpy, but this dividend was not well covered by cash flow. Paying out more than 100% of your free cash flow in dividends is generally not a long-term, sustainable state of affairs, so we think shareholders should watch this metric closely. While Koninklijke Brill's dividends were covered by the company's reported profits, free cash flow is somewhat more important, so it's not great to see that the company didn't generate enough cash to pay its dividend. Cash is king, as they say, and were Koninklijke Brill to repeatedly pay dividends that aren't well covered by cashflow, we would consider this a warning sign.