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

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

Earnings before interest, taxes, depreciation, depletion, amortization and exploration expenses (EBITDAX) is an indicator of a company's financial performance calculated as:

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

BREAKING DOWN '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. Depletion

    An accrual accounting method that companies use to allocate the ...
  2. Depreciation, Depletion and Amortization ...

    A method of accounting associated with the acquisition, exploration ...
  3. Earnings Before Interest, Tax and ...

    An indicator of a company's financial performance, which is calculated ...
  4. Amortization

    1. The paying off of debt in regular installments over a period ...
  5. Earnings Before Interest, Depreciation ...

    A measure of the earnings of a company that adds the interest ...
  6. Earnings Before Interest, Taxes, ...

    A measure of a company's financial performance that looks at ...
Related Articles
  1. Investing

    EBITDA

    Otherwise known as Earnings Before Interest, Taxes, Depreciation and Amortization. Learn more about this indicator of a company's financial performance.
  2. Professionals

    Other Depreciation Considerations

    We look at amortization, depletion and more for what businesses need to consider when using depreciation in their accounting.
  3. Investing

    Amortization

    Amortization and depreciation are two ways to prorate the cost of an asset's life. Learn more about the former and how it it's calculated.
  4. Professionals

    Depletion

    Depletion
  5. Investing

    Depreciation

    Amortization and depreciation are two ways to prorate the cost of an asset's life. Learn more about the latter and how it it's calculated.
  6. Investing

    5 Common Trading Multiples Used In Oil And Gas Valuation

    Before you decide to invest in oil and gas, you should understand these multiples.
  7. Economics

    Explaining Amortization In The Balance Sheet

    Amortization occurs when an asset’s value decreases over time, usually over its estimated useful life.
  8. Professionals

    Capital Cost Allowance And Depreciation

    Depreciation can be used as a tax deduction.
  9. Professionals

    Depreciation

    Depreciation
  10. Professionals

    Permanent Vs. Temporary Items

    CFA Level 1 - Permanent Vs. Temporary Items. Learn the differences between temporary and permanent items in taxation. Discusses how timing differences create tax liabilities.
RELATED FAQS
  1. Does gross profit include depreciation or amortization?

    Understand the distinction between depreciation and amortization, and learn under which circumstances either type of expense ... Read Answer >>
  2. What is the tax impact of calculating depreciation?

    Understand the tax implications of a company's depreciation. Learn how differences in accounting methods change the amount ... Read Answer >>
  3. What is the formula for calculating EBITDA?

    Learn about EBITDA and how companies can manipulate this calculation to look more profitable. Read Answer >>
  4. What is the difference between amortization and depreciation?

    Because very few assets last forever, one of the main principles of accrual accounting requires that an asset's cost be proportionally ... Read Answer >>
  5. How do I calculate an EBITDA margin using Excel?

    Learn about the EBITDA profit margin and how to use Microsoft Excel to calculate this profitability metric using data from ... Read Answer >>
  6. What is the relationship between accumulated depreciation and depreciation expense?

    Understand the relationship between accumulated depreciation and depreciation expense. Learn how each one is accounted for ... Read Answer >>
Hot Definitions
  1. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  2. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  3. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
  4. Generally Accepted Accounting Principles - GAAP

    The common set of accounting principles, standards and procedures that companies use to compile their financial statements. ...
  5. DuPont Analysis

    A method of performance measurement that was started by the DuPont Corporation in the 1920s. With this method, assets are ...
  6. Call Option

    An agreement that gives an investor the right (but not the obligation) to buy a stock, bond, commodity, or other instrument ...
Trading Center