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Glossary: EBITDA

What is EBITDA?

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Stands for Earnings Before Interest, Taxation, Depreciation and Amortization. This is a calculation of company profitability that excludes a number of factors. In some cases, this is a preferred way of looking at company profitability than net earnings because it removes non-cash expenses and expenses that are tied to a business’s capital structure. Example: The company was able to raise debt corresponding to four times it’s annual EBITDA. 

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