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Operating leverage can also be measured in terms of change in operating income for a given change in sales (revenue). The Degree of Operating Leverage (DOL) can be computed in a number of equivalent ways; one way it is defined as the ratio of the percentage change in Operating Income for a given percentage change in Sales (Brigham 1995, p. 426):
We delivered a strong adjusted EBITDA margin of 35%, up 500 basis points year over year, driven by operating leverage, enabled by top-line growth and greater operational productivity while we ...
It relates to operating leverage, which measures the ratio between fixed costs and variable costs. Efficiency means the extent to which cash is generated over time and relative to other enterprises. Efficiency ratios for a given year may therefore be used to determine whether an enterprise has generated enough cash in relation to other years ...
Financial leverage can be beneficial when the business is expanding and profitable, but it is detrimental when the business enters a contraction phase. The interest on the debt must be paid regardless of the level of the company's operating income, or bankruptcy may be the result.
Fourth quarter FAD, funds available for distribution of $0.70 per share reflects continued revenue and EBITDA growth, which has allowed us to reduce leverage to below 4.0x debt-to-EBITDA while ...
Along the U.S. Gulf Coast, where 42% of our capacity exists, we have more than 1.2 million barrels per day of refining capacity, which leverage feedstock and logistics flexibility to provide a ...
Leverage is defined as the ratio of the asset value to the cash needed to purchase it. The leverage cycle can be defined as the procyclical expansion and contraction of leverage over the course of the business cycle. The existence of procyclical leverage amplifies the effect on asset prices over the business cycle.
no transaction costs exist, and individuals and corporations borrow at the same rates. These results might seem irrelevant (after all, none of the conditions are met in the real world), but the theorem is still taught and studied because it tells something very important.