Finance - Measure
EBIT
(Earnings before interest and tax)
A measure of a company's profit before interest costs and tax are taken off
What's it for?
Shows how profitable the company's main business is before financing and tax costs.
For example…
A business has £10 million of sales and £8 million of operating costs, leaving £2 million of EBIT before interest and tax
Often confused with…
- EBITDA (Earnings before interest, tax, depreciation and amortisation)A measure of a company's profit before interest, tax and certain non-cash costs are taken off
- EBITA (Earnings before interest, tax and amortisation)A measure of profit before interest, tax and the accounting cost of certain non-physical assets are taken off