저자: 미상 · 외국인
요약 보기
버핏 주주서한·발언을 인용해 EBITDA의 문제점을 지적. 감가상각은 실제 비용이며 설비투자(CAPEX)를 무시하면 안 된다고 주장. 영업권 상각도 경제적 실체가 없다고 보지 않는다는 입장. 일부 기업의 무세 주장·EBITDA 강조를 'flimflam'(사기성)으로 비판. 대안으로 잉여현금흐름(FCF), 영업현금흐름, owner's earnings, EBIT, NOPAT을 제시하고 업종별 적합 지표를 소개.
다듬은 글
using the word EBITDA, every time you saw that word, you just substituted the phrase earnings. You have argued against the use of alternate measures of profitability such as earnings before interest tax depreciation and amortization as measures of business performance. We regularly told you for some years before the accounting change was made here a year or so ago.
We told you you should not count goodwill amortization. You know, it was required under GAAP. We obviously complied with GAAP, but we told you every year virtually that I can remember, we said, "This is not really an economic expense." And we ignore it in our own calculations of of of earnings in terms of what we will pay for businesses.
We don't care whether there's a goodwill item or not because it it it's immaterial to economic reality. So, we have been quite willing at Berkshire to tell our own owners to ignore certain things. And if they disagreed with us, they they could look at the GAAP figures, but we felt they were getting misled by by looking at the amortization of intangibles.
Um that doesn't mean we think all intangibles were good, but we just we didn't feel that that was a that was an arbitrary and a decision that didn't make any any any sense at all. Um and we felt obviously as we talked about, we felt the crazy pension assumptions of caused people to record phantom earnings in many cases.
Uh so, we're we're willing to tell you when we think there is data that is more important in economic analysis than GAAP figures will we'll talk to you about it. Not thinking of depreciation as expense though strikes us as absolutely crazy. I I can think of very few businesses. I can think of a couple, but I can think of very few businesses where depreciation is not a real expense.
Even on our gas pipelines, I mean you know, at some point they are A A they will need the they'll need repairs, but beyond that at some point they become obsolete. I mean, there there there won't be gas there 200 years from now. We know that. So, it it it depreciation is real and it's the worst kind of expense.
It's reverse float. You know, you lay out the money before you get revenue. And you are out cash with nothing coming in. And depreciation any management that doesn't regard depreciation as expenses, you know, is living in a dream world, but of course they're encouraged to do that you know, by investment bankers who talk to them about EBITDA and then it you know, certain people have built fortunes on misleading investors by convincing them that EBITDA was a big deal.
And when we see companies that say, "A, we don't pay any taxes and you know, because we don't have any earnings for tax purposes and don't count depreciation and all of that." You know, that's coming in our view many times that's coming very close to a flimflam game. Uh you know, I get these people that show me, you know, they want to send me books with EBITDA and then I just tell them, you know, I'll I'll look at that figure when you tell me you'll make all the capital expenditures.
Um if I'm going to make the capital expenditures, there's very few businesses where I think I can spend a whole lot less than depreciation year after year and maintain the economic strength of the business. Uh so, I think EBITDA has been a term that has caused a lot of investors a lot of money. You saw it in the telecom field.
I mean, the idea that they were spending money so damn fast, you know, I mean, they couldn't have it coming in the door fast enough from investors. And then they pretended that depreciation uh was not a real expense. That that's nonsense. I mean, it couldn't be worse. And a generation of investors were sort of brought up to to believe in that.
Um we at Berkshire will spend more than our depreciation this year. We spent more than our depreciation last year. We spent more than our depreciation the year before that. You know, depreciation is a real expense. It's just as much as, you know, the expenditure for for life. It It's not a non-cash expense.
It's a cash expense. You just spend it first. You know, I mean, the cash is gone. And it's it's it's a delayed recording of cash expense. How anybody can turn that into something they use as a metric that that talks about earnings is beyond me. Charlie? Yeah, I think you would understand any presentation using the word EBITDA if every time you saw that word, you just substituted the phrase earnings.
I knew he'd do it sooner or later, folks. And the man he made it for the morning, but it never all day. Look at this table. Warren Buffett famously calls EBITDA a total nonsense because it ignores real and necessary costs like interest, taxes, and capital expenditure. So, Buffett has a number of reasons to reject EBITDA.
But, if you are into business analysis, here are the best alternatives to EBITDA. The first one being free cash flow. It can be used for general valuation and assessing the margin of safety. Operating cash flow can be used for assessing a company's core operational liquidity. Owner's earnings, which was made famous by Warren Buffett himself, can be used for long-term value investing.
EBIT can be used for comparing operational efficiency. And NOPAT, which is net operating profit after tax, can be used for advanced capital return models. And here's some bonus advice. Choose free cash flow when analyzing capital-heavy industries like manufacturing, telecom, or energy, where equipment constantly needs to be replaced.
Choose EBIT if you want a quick way to compare the operational performance of two companies that have completely different debt levels or tax rates. And finally, choose owner's earnings when you want to value a business more like a private buyer or a long-term compounder would. And now you have n number of reasons to avoid EBITDA, isn't it?
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