Ebitda Quotes

I think that, every time you see the word EBITDA, you should substitute the words "bullshit earnings.

By focusing on a few key financial metrics, board members can transform these statements from a labyrinth into a compass, guiding them through the company's financial landscape.

All else being constant, Gross Profit is more important than EBITDA.

Furthermore, we do not think so-called EBITDA (earnings before interest, taxes, depreciation and amortization) is a meaningful measure of performance. Managements that dismiss the importance of depreciation - and emphasize "cash flow" or EBITDA - are apt to make faulty decisions, and you should keep that in mind as you make your own investment decisions,

We usually had four big targets a year: market share, expenses, EBITDA and cash.

Trumpeting EBITDA (earnings before interest, taxes, depreciation and amortization) is a particularly pernicious practice. Doing so implies that depreciation is not truly an expense, given that it is a “non-cash” charge. Imagine, if you will, that at the beginning of this year a company paid all of its employees for the next ten years of their service (in the way they would lay out cash for a fixed asset to be useful for ten years). In the following nine years, compensation would be a “non-cash” expense—a reduction of a prepaid compensation asset established this year. Would anyone care to argue that the recording of the expense in years two through ten would be simply a bookkeeping formality?

If “nonrecurring” charges keep recurring, “extraordinary” items crop up so often that they seem ordinary, acronyms like EBITDA take priority over net income, or “pro forma” earnings are used to cloak actual losses, you may be looking at a firm that has not yet learned how to put its shareholders’ long-term interests first.9

regra de preço de compra e venda das ações foi estabelecida: era agora oficial a métrica de precificação de três vezes o Ebitda da empresa mais o valor do seu patrimônio.

¡El ratio Deuda/EBITDA10 del 2018 había alcanzado el valor de 31!, es decir, el monto de la deuda era 30 veces mayor que el del flujo operativo de la empresa (excluidas la depreciación y la amortización).

descubrir que el 70 % del volumen producía 170 % del Ebitda lo que es un resultado emergente brutal que cuestiona todas las bases de la Teoría del Negocio vigente, era muy difícil de ignorar una vez reenmarcada así.

We have lifted EBITDA from a $30 million run rate to $60 million in the 2012 financial year. This has involved rationalisation of the product range and brands, with a reduction of SKUs from 450 to 250, together with some cost savings throughout the group.

Bad terminology is the enemy of good thinking. When companies or investment professionals use terms such as "EBITDA" and "pro forma," they want you to unthinkingly accept concepts that are dangerously flawed.

Net wages: “It’s not what you make, but what you net” after paying the FIRE sector, basic utilities and taxes. The usual measure of disposable personal income (DPI) refers to how much employees take home after income-tax withholding (designed in part by Milton Friedman during World War II) and over 15% for FICA (Federal Insurance Contributions Act) to produce a budget surplus for Social Security and health care (half of which are paid by the employer). This forced saving is lent to the U.S. Treasury, enabling it to cut taxes on the higher income brackets. Also deducted from paychecks may be employee withholding for private health insurance and pensions. What is left is by no means freely available for discretionary spending. Wage earners have to pay a monthly financial and real estate “nut” off the top, headed by mortgage debt or rent to the landlord, plus credit card debt, student loans and other bank loans. Electricity, gas and phone bills must be paid, often by automatic bank transfer – and usually cable TV and Internet service as well. If these utility bills are not paid, banks increase the interest rate owed on credit card debt (typically to 29%). Not much is left to spend on goods and services after paying the FIRE sector and basic monopolies, so it is no wonder that markets are shrinking. (See Hudson Bubble Model later in this book.) A similar set of subtrahends occurs with net corporate cash flow (see ebitda). After paying interest and dividends – and using about half their revenue for stock buybacks – not much is left for capital investment in new plant and equipment, research or development to expand production.

the CVC group has battled with its Channel 9 media purchase from day one. Having paid a double digit EBITDA purchase price this debt laden deal has delivered a huge equity loss for CVC of approximately $2 billion.

As any business person will tell you, the value of a traditional company is based on thirty times its EBITDA (earnings before income and tax depreciation of assets). If the company makes $1 million a year, it is said to be worth $30 million.

As any business person will tell you, the value of a traditional company is based on thirty times its EBITDA (earnings before income and tax depreciation of assets). If the company makes $1 million a year, it is said to be worth $30 million. But the Internet wasn’t measured in those terms because most people weren’t making any money. Instead, Internet companies were evaluated on the perception that someday, in the not-too-distant future, simply because of their connection to the Internet, they would be rolling in huge amounts of cash.

despesas financeiras refletem uma decisão de estrutura de capital, que é definida pelos sócios, e não a eficiência dos dois gestores na administração dos investimentos operacionais.

The outstanding debt of six conglomerates—Lanco, Jaypee, GMR, Videocon, GVK and Essar—was even more excessive than ADAG in relation to their respective EBITDAs. However, ADAG had the highest outstanding debt among the ten conglomerates. ADAG was thus billed as India’s most indebted company by the media.

otro lado del espectro es que al mismo tiempo las empresas buscan la forma de satisfacer estas necesidades, eligiendo aquellas oportunidades de digitalización que afecten de forma positiva su EBITDA o beneficios gruesos a través de la optimización de sus activos inmuebles. Es por eso que en un momento como el de ahora en el que hay tantas startups y nuevas estrategias a su disposición, para enfrentarse a esta saturación utilizan a grueso modo cuatro aspectos principales de análisis que les ayudan a discernir la prioridad

References to EBITDA make us shudder — does management think the tooth fairy pays for capital expenditures?

EBITDA, as we noted earlier, is no longer Wall Street’s favorite measure to watch. Now the hot metric is free cash flow. Some companies have looked at free cash flow for years. Warren Buffett’s Berkshire Hathaway is the bestknown example, though Buffett calls it owner earnings. As Buffett’s term suggests, it’s an important metric for entrepreneurial companies.

EBITDA is an acronym for "earnings before interest, taxes, depreciation and amortization." It is computed by taking a company’s net income for a particular period and adding back the amount of interest expense, tax expense, depreciation and amortization for such period, all of which, under GAAP, have been deducted in arriving at the net income figure. Financial analysts consider EBITDA to be one of the most important measures of a company’s operating financial performance.

some investors treat depreciation as if it were not an expense by adding it back to operating income. For example, they use a metric called EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) to analyze the earning power of a company and compare it to its competitors. This kind of thinking is flawed.

Limited Partners Supply Capital The way a private equity fund starts investing is by issuing capital calls for the money it needs from limited partners. Here’s an example. You are an investor in a small private equity firm’s fund that is $100 million in size. You commit $1 million to the fund, or 1 percent. You don’t invest that money up front; rather, you’ve committed the capital, and as the fund seeks investments, it will issue a capital call when it needs the money. The private equity firm decides to purchase a company that has $4 million of EBITDA—discussed further in chapter 9, “EBITDA” (pronounced as three syllables: e-bit-dah) is earnings before interest, taxes, depreciation, and amortization. The firm buys this company for 8x EBITDA, or 8x $4 million, for an enterprise value of $32 million. Typically, when a private equity firm buys a company, they use the maximum amount of leverage or debt the cash flow of the company allows. In this example, we will use 5x leverage, so 5x EBITDA is $20 million of debt financing, leaving another $12 million of equity from that $100 million fund needed to complete the purchase. The fund issues a capital call, and as a 1-percent limited partner, you get a call that states you need to send $120,000, which is 1 percent of the $12 million of equity needed. This is the pro rata portion of the equity needed by the firm to purchase the company.

Private Equity Means No Liquidity The private equity fund is made up of people committed to providing capital. They’ve signed up for it. They may not get their money back for ten years or more. The firm makes investments and issues capital calls to the limited partners. As a limited partner, you send in your portion to meet the demand for the cash that’s needed at the time. Because it’s private, there’s no liquidity, and a limited partner has no decision power. There’s no way to get your capital back on demand. This is typically why investment sizes are large. Private equity firms are not geared to handle nonaccredited investors who may need to get their money out quickly. The return of capital happens over time. Anytime a private equity fund sells a company or refinances for the purpose of creating a distribution, it returns capital to its limited partners. Using the same example as above, let’s say the company is sold five years later. Instead of the $4 million of EBITDA when it was purchased, the company now has $12 million of EBITDA. Earnings increased 3x over a five-year period. The company is sold for the same 8x multiple, only now the enterprise value is $96 million for something that they paid $32 million for five years earlier. That $20 million in original debt financing plus perhaps another $40 million in additional debt and transaction expenses (from buying add-on companies, legal fees, diligence fees, investment banker fees, and carried interest fees) leaves $36 million in equity remaining. As a 1-percent limited partner, you now receive a distribution from the fund for 1 percent or $360,000. The initial investment was $120,000, but your distribution five years later, net of fees, is $360,000 or a 3x multiple of invested capital (MOIC)—discussed further in chapter 2. This example shows how a private equity fund receives and distributes money. The capital calls are fulfilled as the fund makes purchases, not up front. In this case, the distribution from the fund back to the limited partner occurred five years after the initial capital call when the purchased company was sold. Many larger private equity firms often have multiple overlapping funds—some late stage and some early stage—operating with dozens of portfolio companies. Those companies aren’t all bought and sold on the same date. There’s a flow of money, mostly coming into the fund from limited partners in early years to fund platforms and then mostly being returned in later years as platforms are sold.