Page 6 - NBIZ October 2020

MAXIMIZING

COMPANY VALUE

Tracking EBITDA During COVID

By Patrick Ungashick

f your exit strategy is to sell your labor, debt and other financial and
company one day for the maximum operational factors. Many companies
Ivalue (perhaps as soon as possible are experiencing negative changes
once the COVID-19 recession is such as lost revenue and profits due EBITDA
over), then it is essential to track to the virus’s impact, while others
your company's EBITDA accurately. are experiencing positive demand Earnings Before
(EBITDA stands for Earnings Before for their products and services.
Interest, Taxes, Depreciation and Either way, the virus is altering many Interest, Taxes,
Amortization.) However, the COVID-19 companies’ financial results, which
pandemic and economic recession means adjusting the EBITDA. Some Depreciation and
have significantly altered many of the changes are temporary (non-
companies' financial results and recurring) and are expected to revert Amortization.
condition. The virus causes many to pre-COVID-19 conditions in the
companies to experience "abnormal" future. Other changes may be more
changes to revenue, costs, margins, permanent.

6 NBIZ ■ October 2020