EBITDA Margin Calculator

Formula

The formula to calculate the EBITDA Margin is:

\[ \text{EM} = \left( \frac{\text{EBITDA} - \text{AC}}{\text{EBITDA}} \right) \times 100 \]

Where:

$\text{EM}$ is the EBITDA Margin (%)
$\text{EBITDA}$ is the total earnings before interest and tax ($)
$\text{AC}$ is the total associated costs ($)

What is EBITDA Margin?

EBITDA Margin is a measure of a company's operating profitability as a percentage of its total revenue. It is calculated by subtracting the total associated costs from the total earnings before interest and tax (EBITDA), dividing the result by EBITDA, and then multiplying by 100. This metric helps in assessing the efficiency and profitability of a company's core operations.

Example Calculations

Example 1:

Total Earnings Before Interest and Tax (EBITDA): $100,000
Total Associated Costs (AC): $30,000

Using the formula:

\[ \text{EM} = \left( \frac{100,000 - 30,000}{100,000} \right) \times 100 = 70 \% \]

Example 2:

Total Earnings Before Interest and Tax (EBITDA): $50,000
Total Associated Costs (AC): $20,000

Using the formula:

\[ \text{EM} = \left( \frac{50,000 - 20,000}{50,000} \right) \times 100 = 60 \% \]