Originally Posted by
Snoopy
Now let's rework the covenant figures for FY2011, assuming underlying earnings and costs are unchanged. That means $6.5 Depreciation & Amortization, $149.8mx0.08= $12m Interest and $24m x 0.3= $7.2m tax.
=> EBITDA= $24m+$6.5m+$12m+$7.2m= $49.7m
SDCR = [$149.8m-($24m+$6.5{D&A})m)]/ $49.7m= 2.4 < 3.0 so O.K.
FCCR = [$49.7m+$29.8m]/[($12m+$4m+$2.5m+$29.8m]= 1.64 < 2.00 , so not good enough
Looks like FY2011 is shaping up to be more challenging than FY2010, however you look at things.
SNOOPY