Earnings Before Interest, Taxes, Depreciation, Depletion, Amortization and Exploration Expenses - EBITDAX

AAA

DEFINITION of 'Earnings Before Interest, Taxes, Depreciation, Depletion, Amortization and Exploration Expenses - EBITDAX'

An indicator of a company's financial performance calculated as:

= Revenue - Expenses (excluding tax, interest, depreciation, depletion, amortization and exploration expenses)

INVESTOPEDIA EXPLAINS 'Earnings Before Interest, Taxes, Depreciation, Depletion, Amortization and Exploration Expenses - EBITDAX'

EBITDAX is used when reporting earnings for oil and mineral exploration companies. It excludes costly exploration expenses and gives the true EBITDA of the firm.

This is especially useful when a company wants to acquire another company. The EBITDAX would cover any loan payments needed to finance the takeover.

RELATED TERMS
  1. Amortization

    1. The paying off of debt in regular installments over a period ...
  2. Earnings Before Interest & Tax ...

    An indicator of a company's profitability, calculated as revenue ...
  3. Takeover

    A corporate action where an acquiring company makes a bid for ...
  4. Earnings Before Interest, Depreciation, ...

    An earnings metric used in the evaluation of oil, gas and mineral ...
  5. Earnings Before Interest, Tax and ...

    An indicator of a company's financial performance, which is calculated ...
  6. Earnings

    The amount of profit that a company produces during a specific ...
Related Articles
  1. Markets

    A Clear Look At EBITDA

    This measure has its benefits, but it can also present earnings through rose-colored glasses.
  2. Active Trading

    Oil And Gas Industry Primer

    Before jumping into this hot sector, learn how these companies make their money.
  3. Active Trading

    Uncovering Oil And Gas Futures

    Find out how to stay on top of data reports that could cause volatility in oil and gas markets.
  4. Options & Futures

    EBITDA: Challenging The Calculation

    This measure has a bad rap, but it's still a valuable tool when used appropriately.
  5. Active Trading

    Unearth Profits In Oil Exploration And Production

    Drill down into financial statements to tap into the right companies and let returns flow.
  6. Economics

    What is Value Added?

    Value added is used to describe instances where a firm takes a product and adds a feature that gives customers a greater sense of value.
  7. Economics

    Understanding Specialization

    Specialization is when a person, business, or region focuses their productive efforts on a smaller subset of a larger system for a competitive advantage.
  8. Economics

    What is the Breakeven Point?

    In general, when gains or revenue earned equals the money spent to earn the gains or revenue, you’ve hit the breakeven point.
  9. Charts & Patterns

    Why These Could Be 2015's 10 Best Biotech Stocks

    A quick look at a 10 biotech companies that are poised to deliver for shareholders in 2015.
  10. Mutual Funds & ETFs

    How To Build A Bond Ladder?

    Bond laddering is a strategy used when building a portfolio: an investor can spread out interest rate risk and create a stream of cash flows for income.

You May Also Like

Hot Definitions
  1. Interest Rate Risk

    The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between ...
  2. Income Effect

    In the context of economic theory, the income effect is the change in an individual's or economy's income and how that change ...
  3. Price-To-Sales Ratio - PSR

    A valuation ratio that compares a company’s stock price to its revenues. The price-to-sales ratio is an indicator of the ...
  4. Hurdle Rate

    The minimum rate of return on a project or investment required by a manager or investor. In order to compensate for risk, ...
  5. Market Value

    The price an asset would fetch in the marketplace. Market value is also commonly used to refer to the market capitalization ...
  6. Preference Shares

    Company stock with dividends that are paid to shareholders before common stock dividends are paid out. In the event of a ...
Trading Center