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Understand the movements between EBITDA and cash
See how maintenance capex, working capital, interest, tax and normalizations affect an illustrative adjusted flow. Debt principal repayments and growth investment are excluded. This is not the amount available to spend or distribute.
Your illustrative adjusted flow
Use the same period and currency for every input. The full breakdown is open, and your figures stay in this browser.
Use the same currency for every input. Changing EUR or CHF changes the display only, with no exchange rate conversion.
Optional valuation normalizations are hypothetical adjustments, not additional cash received. Keep them at zero when examining unadjusted cash movements.
Enter the increase in working capital as a positive number (cash tied up). A release of working capital is negative (cash freed).
Illustrative adjusted flow before principal and growth investment
€460,000
Adjusted flow / EBITDA: 57%. This is not a measure of cash available for distribution.
Difference between EBITDA and adjusted flow: €340,000.
From EBITDA to an illustrative adjusted flow
| Step | Movement | Running total |
|---|---|---|
| EBITDA | €800,000 | €800,000 |
| Less: maintenance capex | − €80,000 | €720,000 |
| Less: increase in working capital | − €120,000 | €600,000 |
| Less: cash interest | − €60,000 | €540,000 |
| Less: cash taxes | − €110,000 | €430,000 |
| Plus or minus: normalizations | + €30,000 | €460,000 |
| Illustrative adjusted flow | €460,000 | €460,000 |
Adjusted flow / EBITDA
57%
EBITDA to cash gap
€340,000
What this means
Part of EBITDA is absorbed by the movements entered. Review working capital, maintenance investment, interest and taxes, then add principal repayments and growth investment for a fuller cash forecast.
A cash forecast also needs opening cash, actual payment timing, debt drawdowns and principal repayments, growth investment and other flows. Normalizations can help compare earnings but do not put cash into the bank.
How this is calculated
Subtract maintenance capex, the increase in working capital, cash interest and cash taxes from EBITDA, then apply optional normalizations. The result is illustrative adjusted flow before debt principal repayments and growth investment. Normalizations may not be actual cash movements. It is neither a bank balance nor distributable cash.
Adjusted flow = EBITDA − maintenance capex − increase in working capital − cash interest − cash taxes ± normalizations.
Illustrative estimate for a single consistent period. Excludes principal repayments, growth investment and other financing flows. Optional normalizations are not necessarily cash received. Do not use this result alone to determine distributions or funding needs.
When to use this
A fast reality check on the difference between profit and cash.
Diagnosing a cash squeeze
Identify the movements entered that reduce the illustrative adjusted flow, then reconcile them with actual cash movements.
Preparing for a sale
Buyers pay for cash flow, not EBITDA. Understand the bridge they will scrutinize in due diligence.
Prepare a fuller cash forecast
Add opening cash, principal repayments, growth investment and other flows before evaluating financing needs or possible distributions.
Turn the bridge into more cash
Fractional CFO for SMEs and startups
A senior finance partner to lift cash conversion: tighten working capital, plan capex and protect margins, from EUR 1.5k/month.
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