Why EBITDAC matters more than EBITDA

EBITDA shows operating performance.

EBITDAC shows true cash-generating ability.

EBITDAC = EBITDA before interest, depreciation, amortization, and capitalization.

For acquirers, this matters because capitalization policies can materially distort EBITDA:

• costs capitalized instead of expensed
• aggressive activation of development, software, or project costs
• EBITDA inflated by accounting choices, not economics

EBITDAC neutralizes these effects and answers the only question that really matters in an acquisition:

How much cash does the business generate on a sustainable basis?

Valuation, leverage capacity, and return models are built on cash reality — not accounting optics.

EBITDA is accounting.

EBITDAC is economics.