Discounted cash-flow method
Valuation model for projects and ventures. All future free cash flows are discounted to their present values and added up. Key factors are the cost of capital (discount), the future free cash flows and the period of time involved.
EBIT
Abbreviation for ‘earnings before interest and taxes.’
EBITA
Abbreviation for ‘earnings before interest, taxes and goodwill amortization.’ In Bilfinger Berger’s accounting, EBITA is used as a performance measure for the profits from operating activities.
Equity consolidation
Minority holdings in companies of between 20% and 50 % are included in the consolidated financial statements as associated companies by means of equity-method consolidation. In the consolidated income statement, the pro-rated net profit of the associated companies – reduced by goodwill amortization if necessary – is shown under income from investments.
Equity ratio
Key figure for a company’s financing structure, stating the ratio between equity and total assets.
Fair value
The amount for which an asset could be sold or a liability could be settled between knowledgeable, willing and independent parties.
Goodwill
The difference between the amount paid for a company and the market value of its net assets. It arises as a result of taking into consideration a company’s expected future earnings when deciding on a suitable price for it. Goodwill is capitalized under fixed assets and subjected to annual impairment tests in accordance with IFRS 3 / IAS 36.
IASB
Abbreviation for ‘International Accounting Standards Board’ based in London. An institution founded in 1973 for the formulation of International Accounting Standards (IAS).