22 May 2018

EBITDA

EBITDA is the cash profit and actually stands for Earnings Before Interest Tax Depreciation and Amortisation (“D&A”).


Amortisation is another kind of Depreciation. All these other items reduce the final profit. Some companies, such as supermarkets, like to show EBITDAR where the “R” is rent. Sainsburys, who own less property and so pay more rent than Tescos, like to compare EBITDAR because it makes them look better. EBIT is profit after D&A but Before Interest and Tax.


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