Investor Presentaiton
Appendix A
Adjusted EBITDA, and Adjusted EBITDA margin Definition
We use EBITDA, Adjusted EBITDA, and Adjusted EBITDA margin in evaluating the performance of our business, and we use each in the
preparation of our annual operating budgets and as indicators of business performance and profitability. We believe EBITDA, Adjusted EBITDA,
and Adjusted EBITDA margin allow us to readily view operating trends, perform analytical comparisons and identify strategies to improve
operating performance.
We define Adjusted EBITDA as net income adjusted to exclude (1) income tax expense, (2) interest expense, net, (3) depreciation and
amortization expense, (4) amortization of customer relationship intangibles, (5) expenses related to the acquisition of RSI Home Products, Inc.
("RSI acquisition") and the subsequent restructuring charges that the Company incurred related to the acquisition, (6) inventory step-up
amortization, (7) non-recurring restructuring charges, (8) stock-based compensation expense, (9) gain/loss on asset disposals, (10) change in
fair value of foreign exchange forward contracts, and (11) pension settlement charges. We believe Adjusted EBITDA, when presented in
conjunction with comparable GAAP measures, is useful for investors because management uses Adjusted EBITDA in evaluating the
performance of our business.
We define Adjusted EBITDA margin as Adjusted EBITDA as a percentage of net sales.
American Woodmark
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