He is still talking down to you?As I spoke of many times and have quote from financial gurus many times, EBITDA equates to "bullshit earning", so why does he continue to do it?
Is it because he does not know what the interest charges are? He most certainly does because it is a fixed amount and would be known before the quarter even ended.
Is it because he does not know what the D&A is? Again, he most certainly does because it is a fixed amount and would be known before the quarter even ended.
Is it because EBITDA is unrecognized by GAAP and IFRS and therefore can be any financially abusive and misleading tool that you wish it to be?...I think that is it.
"Earnings" means what is left after everything is paid, therefore the words "Earnings Before" is in itself is an oxymoron. Earnings before interest, tax, depreciation, amoritization,stock based compensation, unrealized foreign exchange, impairment of loans receivable, gain/loss on settlement of loans payable, gain/loss on disposal of assets, and non-recurring costs, finance lease receivable reduction, and its 50% share of the income/expense and gain/loss categories from the Company's income from equity accounted investees....Yes, it most definitely is what Mr. Munger called it, "Bullshit Earnings" and only flies with those that do not know any better, which to me seems to be his ideal investor base.
NonIFRS Measures – Poydras Gaming Finance Corp.:
Adjusted EBITDA is a financial measure that does not have a standardized meaning under IFRS. Adjusted EBITDA is defined as earnings before financing costs, income taxes, depreciation, amortization, stock based compensation, unrealized foreign exchange, impairment of loans receivable, gain/loss on settlement of loans payable, gain/loss on disposal of assets, and non-recurring costs. In addition, to arrive at adjusted EBITDA, the Company is adjusting its earnings for finance lease receivable reduction and its 50% share of the above mentioned income/expense and gain/loss categories that are included in the Company's income from equity accounted investees. The Company believes that to measure the Company's core business performance and liquidity, and to measure its ability to purchase additional machines, it is important to include these adjustments in determination of adjusted EBITDA.