If several companies or businesses are using

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That is, all the profits and gross profits of the company in its general activities. What is done before the deduction of financial expenses mentioned in the previous point, in order to obtain net results of profitability appreciation.  the EBITDA method to measure their profitability, it is possible to use a cash flow analysis to determine which of all these companies, which in turn belong to the same sector, is more profitable than another. And you may ask yourself, why is this method used considering that it is not so precise or does not cover all of the company's financial expenses?


Benefits of applying EBITDA in a company Believe Belarus WhatsApp Number it or not, for many entrepreneurs who own a business, it is important to know how profitable their project is on a gross basis. That is, without taking into consideration all the expenses involved in keeping a company running, how much is actually being obtained from the exploitation of the activities themselves. And that is one of the main benefits of this method, that it does not require those expenses to measure net profits. Earnings that can be taken into consideration to make payments on outstanding debts after most significant expenses have been subtracted.





At the same time, it is also a very useful tool for making comparisons of companies throughout their history. In this way, we can determine the financial health of different companies that belong to a specific market sector. The calculations performed in this method are quite simple and quick to formulate. Thus, it is possible to give you an example of this in a much more practical and visual way: EBITDA is equal to : Revenue – costs of goods sold – general administrative costs How EBITDA is calculated Thus, you can see that it is a fairly simple operation and that it determines net productivity results.