medium · Debt Capital Markets credit-ratings-risk
In a 'Ratio Debt' incurrence test, the EBITDA used in the denominator is typically based on:
- The Last Twelve Months (LTM) period, adjusted pro forma for any recent acquisitions or divestitures.
- The EBITDA recorded during the single best individual quarter in the company's operating history.
- The simple arithmetic average of annual EBITDA spanning every fiscal year since the company was founded.
- The aggregate EBITDA that the company internally projects it will earn over the next three full fiscal years.
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