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  "notes": "The slide discusses the limitations of accounting-based metrics and advocates for cash-flow based adjustments.",
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      "kind": "callout",
      "text": "OpFCF is not perfect but is our preferred approach to improving comparability",
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      "text": "Operating free cash flow (OpFCF): OpFCF is a modified version of EBITDA designed to retain the benefits EBITDA provides in accounting comparability but avoid the problem of ignoring differences in capital intensity (capex). OpFCF = EBITDA - maintenance capex - maintenance increase/(decrease) in net working capital.",
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      "text": "Revenue: Revenue has often been advocated as a suitable basis for analysis and valuation on the grounds that it is largely comparable across different accounting systems. There are two problems with this: Sales are not as unaffected by accounting policies as is commonly thought; Revenue is an incomplete measure of performance given its lack of focus on profitability and cash flow.",
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      "text": "EBITDA: EBITDA has become the most common measure of performance and value that supposedly overcomes the problem of accounting differences. A crucial failing of EBITDA, however, is that it ignores the very real costs of capital expenditure and taxation that should (and do) affect value.",
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      "kind": "other",
      "text": "2 The problems of EBITDA are explored in more detail in our publications EBITDA Multiples and Capital Intensity, February 1999, and ...But it Looks Cheap on EV/EBITDA, September 1999, available at ubswarburg.com/research/gvg.",
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      "text": "Multiples are only meaningful if the profit statistic used is representative of the future. Profit fluctuations can have a substantial impact on multiples. Consider a company that has a steady earnings trend but takes a one-off restructuring charge:",
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      "text": "Valuation Multiples: A Primer",
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      "kind": "title",
      "text": "3. Fluctuations in Profits",
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