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EBITDA Margin Template

EBITDA Margin Template

This EBITDA margin template shows you how to calculate EBITDA margin using revenue amounts and EBITDA.

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EBITDA Margin Template

 

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EBITDA Margin Template

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EBITDA margin is a profitability ratio that measures how much earnings the company is generating before interest, taxes, depreciation, and amortization, as a percentage of revenue. EBITDA Margin = EBITDA / Revenue.

The “earnings” are calculated by taking sales revenue and deducting operating expenses, such as the cost of goods sold (COGS), selling general & administrative (SG&A), but excluding depreciation and amortization.

The margin does not include in the impact of the company’s capital structure, non-cash expenses, and income taxes. This ratio may be used in conjunction with other leverage and profitability ratios.

 

To compute the EBITDA ratio the following formula is used:

EBITDA Margin =  EBITDA / Net Sales

 

EBITDA margin is considered to be the cash operating profit margin of a business before capital expenditures, taxes, and capital structure are taken into account. It eliminates the effects of non-cash expenses such as depreciation and amortization. Investors and owners can get a sense of how much cash is generated for every dollar of revenue earned and use the margin as a benchmark in comparing various companies.

 

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