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Molex, Inc. (NAS:MOLX)
EBITDA
$607 Mil (TTM As of Sep. 2013)

Molex, Inc.'s EBITDA for the three months ended in Sep. 2013 was $180 Mil. Its EBITDA for the trailing twelve months (TTM) ended in Sep. 2013 was $607 Mil.

Molex, Inc.'s EBITDA per Share for the three months ended in Sep. 2013 was $0.99. Its EBITDA per share for the trailing twelve months (TTM) ended in Sep. 2013 was $3.36.


Definition

Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) is what the company earns before it expenses interest, taxes, depreciation and amortization.

Molex, Inc.'s EBITDA for the fiscal year that ended in Jun. 2013 is calculated as

EBITDA(A: Jun. 2013 )
=Operating Income+Depreciation, Depletion and Amortization
=352.134+234.885
=587

Molex, Inc.'s EBITDA for the quarter that ended in Sep. 2013 is calculated as

EBITDA(Q: Sep. 2013 )
=Revenue-Cost of Goods Sold-Selling, General, & Admin. Expense-Research & Development-Others
=936.367-633.816-179.429-0--57.245
=180

EBITDA(Q: Sep. 2013 )
=Operating Income+Depreciation, Depletion and Amortization
=123.122+57.245
=180

Molex, Inc. Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Sep. 2013 was 166.175 (Dec. 2012 ) + 118.981 (Mar. 2013 ) + 141.386 (Jun. 2013 ) + 180.367 (Sep. 2013 ) = $607 Mil.

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Sometimes companies may have already deducted Depreciation and Amortization from Gross Profit. In this case Depreciation and Amortization needs to be added back when calculating EBITDA.


Explanation

EBITDA is a cash flow measure that ignores changes in working capital. EBITDA minus Depreciation, and Amortization (DA) equals Operating Income. Operating Income is profit before interest and taxes. Of course, Interest and taxes need to be paid.

While depreciation and amortization expenses do not need to be paid in cash, assets - especially tangible assets - do need to be replaced over time. EBITDA is not a measure of profit in any sense. EBITDA is a measure of cash generation by a business where the uses of that cash may be more or less discretionary depending on the nature of the business.

The EBITDA of a TV station is largely discretionary. Owners may use much of the EBITDA generated by a TV station as they see fit. The EBITDA of a railroad is largely non-discretionary. Owners must use much of the EBITDA generated by a railroad to replace the physical assets of the railroad or the business will literally fall apart over time.

EBITDA can be thought of as the cash a business generates that is available to:

• Add more inventory
• Add more receivables
• Replace property, plant, and equipment
• Add more property, plant, and equipment
• Pay interest
• Pay taxes
• And finally: pay owners

EBITDA is widely used in financial analysis because Depreciation and Amortization are not present day cash expenses.. Depreciation and amortization are the spreading out of the costs of assets over the time in which those assets provide benefits. Today’s depreciation and amortization expenses relate to assets bought in the past. The assets being expensed may or may not need to be replaced in the future. And the cost to replace the assets may be more or less than it was in the past. For this reason, the depreciation and amortization expenses a company records in the present year may have no relationship to the actual cash costs needed to maintain its assets in future years.

A company’s depreciation expense depends on both its expectations about the assets it owns and its choice of accounting methods. Two companies owning identical assets may have different depreciation expenses because they have different expectations about the useful lives of those assets and because they make different accounting choices.

Analysts use EBITDA to remove this element of personal choice from a company’s accounting statements. The use of EBITDA is an attempt to make the results of different companies more comparable and uniform.


Be Aware

Although depreciation is not a cash cost it is a real business cost because the company has to pay for the fixed assets when they purchase them. Both Warren Buffett and Charlie Munger hate the idea of EDITDA because in this calculation, depreciation is not counted as an expense.

EBITDA over Revenue is a good metric for comparing the operating efficiencies between companies because EBITDA is less vulnerable to companies’ accounting choices. For this reason, EBITDA is used in ranking the Predictability of Companies. Also price/EBITDA is sometimes used in valuations.


Related Terms

Revenue, Cost of Goods Sold, Selling, General, & Admin. Expense, Research & Development, Gross Profit, Depreciation, Depletion and Amortization, Operating Income


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Molex, Inc. Annual Data

Jun04Jun05Jun06Jun07Jun08Jun09Jun10Jun11Jun12Jun13
Operating Income 777197311322318-346138430399352
DDA 242246215238252252239242237235
EBITDA 1,019443526559570-94376672636587

Molex, Inc. Quarterly Data

Jun11Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13
Operating Income 1101219789931031076083123
DDA 60616058575860595857
EBITDA 171182157147150160166119141180
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