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GLOSSARYTERMS AS A CREDIT DESK USES THEM

EBITDAaL (EBITDA after leases)

What is EBITDAaL, and how does it differ from EBITDA and EBITDAR?

ONE OF 416 TERMS · FREE · NO SIGNUP

BY MICHAEL SHANG · SIXTEEN YEARS IN COMMERCIAL BANKING · UPDATED

// THE SHORT ANSWER

EBITDAaL is EBITDA after leases: EBITDA reported under IFRS 16 less the depreciation of right-of-use assets and the interest on lease liabilities, which puts the cost of leases back above the line where rent used to sit. Telecom operators and other heavy lessees publish it to compare with the years before 2019, and definitions vary by company. A group with IFRS 16 EBITDA of US$100m, lease depreciation of US$25m and lease interest of US$5m has EBITDAaL of US$70m. A lender reading it pairs it with debt that excludes lease liabilities, because counting the leases in both the earnings and the debt charges for them twice.

BASIS  Practitioner judgment from sixteen years in commercial banking, set out in How Bankers Think (Highbank Press, 2026). Every borrower on this site is a composite constructed for teaching, not a client. The market is mid-market commercial lending as practised in New Zealand and Australia; where a convention differs elsewhere, the page says so.

// THE FULL PAGE

EBITDAaL: a Worked Example →

Take the leases out of earnings or put them into debt. Not both.

// WHAT IT IS NOT

EBITDAR adds rent back so that leases can be counted as debt; EBITDAaL takes lease costs out of earnings so that leases can be left out of debt. They are opposite routes to the same comparison, and mixing them in one ratio double-counts or drops the leases.

// WORKED IN

// NEXT TO IT

READING THE NUMBERS

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