Earnings before Interest, Taxes and Amortization

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Earnings before Interest, Taxes and Amortization (EBITA) refers to a company's earnings before the deduction of interest, taxes and amortization expenses.[1] It is a financial indicator used widely as a measure of efficiency and profitability.

EBITA margin can be calculated by taking the Profit Before Taxation (PBT/EBT) figure as shown on the Consolidated Income Statement, and adding back Net Interest and Amortization. Often, Amortization charges are zero and therefore EBIT = EBITA.

EBITA has been cited by buyside investors as a useful metric to be used as a replacement for, or in conjunction with, EBITDA multiples, as corporations continue to present increasing levels of intangible-based amortization.

References[edit]

  1. ^ "EBITA". Retrieved 2014-11-30. 

See also[edit]