EBITDA quality
The sustainability and evidential support of an earnings before interest, taxes, depreciation and amortization (EBITDA) measure, including the reliability of its adjustments and the earnings likely to recur. A single disputed adjustment does not capture every aspect of quality.
EBITDA quality in round numbers
Hypothetical, in US$ millions: same-period adjusted EBITDA of 6.88 is reduced to 5.83 during diligence, a difference of 1.05. At a fixed assumed 8x enterprise-value multiple, the implied enterprise-value difference is 8.40. It is not automatically a change in final price or equity proceeds.
Terms Related to EBITDA quality
Quality of earnings (QofE) · Diligence-adjusted EBITDA · Adjusted EBITDA · EBITDA add-backs · Revenue cut-off · All of the glossary