U.S. Coal Demand and Peabody Strategic Overview
Reconciliation of Non-GAAP Measures: Definitions
1 Adjusted EBITDA is a non-GAAP measure defined as income (loss) from continuing operations before deducting net interest
expense, income taxes, asset retirement obligation expenses, depreciation, depletion and amortization and reorganization
items, net. Adjusted EBITDA is also adjusted for the discrete items that management excluded in analyzing the segments'
operating performance as displayed in the reconciliation. Adjusted EBITDA is used by management as one of the primary metrics
to measure our operating performance. Management also believes non-GAAP performance measures are used by investors to
measure our operating performance and lenders to measure our ability to incur and service debt. Adjusted EBITDA is not
intended to serve as an alternative to U.S. GAAP measures of performance and may not be comparable to similarly-titled
measures presented by other companies.
2 Free Cash Flow is a non-GAAP measure defined as net cash provided by operating activities less net cash (used in) provided by
investing activities. Free Cash Flow is used by management as a measure of our financial performance and our ability to generate
excess cash flow from our business operations. Free Cash Flow is not intended to serve as an alternative to U.S. GAAP measures
of performance and may not be comparable to similarly-titled measures presented by other companies.
Peabody
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