EBITDA bridge
- Base 7,000,000 → scenario EUR 5,952,000 (change -EUR 1,048,000); covenant 5,500,000; headroom EUR 452,000.
Financial Intelligence · Expanded Financial Intelligence
Financial Scenario and Sensitivity Modeling
Model pricing, hiring, investment, expansion, cost-reduction and operating scenarios with explicit variables and assumptions kept distinct from facts.
Demonstration: Osterley Components GmbH (fictional) · Industrial manufacturing. Fictional data and a scripted answer.
The situation
- Organisation
- Osterley Components GmbH (fictional)
- Who is asking
- Chief financial officer
- Industry
- Industrial manufacturing
- What happened
- The bank covenant requires EBITDA of at least 5.5 million, and the budget assumes a price rise that the sales team doubts.
The question asked
How much room do we have against the covenant if price, volume and costs do not go as planned?
What it reads, and who can see the result
- Budget P&L exportRevenue, variable and fixed costs.
- Covenant terms documentThe EBITDA test and its definition.
- Reads
- The budget P&L lines and the covenant definition.
- Does not read
- Customer-level data, or any bank account.
- Permission
- Finance planning read access.
- Who sees it
- The CFO and the board audit committee.
Try it
Change the assumptions. Every result and the answer below are recomputed from them, and a warning appears when a result crosses a stated limit.
- Revenue
- EUR 49,440,000Base 50,000,000.
- Variable costs
- EUR 31,248,000Base 31,000,000 (62% of revenue).
- Fixed costs
- EUR 12,240,000Base 12,000,000.
- EBITDA
- EUR 5,952,000Base 7,000,000.
- Change from base
- -EUR 1,048,000
- Headroom over the covenant
- EUR 452,000
The answer
Simulated answer. Written for this fictional case, not produced by a live model. Only the figures in it are computed, from what you decided above.
In this scenario EBITDA is EUR 5,952,000; headroom against the covenant level is EUR 452,000.
Against a base of 7,000,000 the scenario changes EBITDA by -EUR 1,048,000 [S1]. The covenant requires 5,500,000 [S2]. Price and cost inflation move the answer more than a small volume change, because price drops straight through to profit while volume also moves the costs that scale with it.
Use the sliders to find the combination that breaches the covenant, and judge whether that combination is realistic, not just possible.
Relies on: S1 · Budget P&L, base caseS2 · Facility agreement, financial covenant
No approval is needed for this result: it is read-only insight, and nothing consequential happens because of it.
What it produces
What to monitor
- Track realised price against budget monthly.
- Open the covenant conversation early if headroom falls near zero.
Limits of this example
- A simple driver model: it does not model the timing of price changes or hedges.
- The covenant definition of EBITDA is applied as summarised; the agreement governs.
- This is a scripted demonstration on fictional data. No model was called and no real organisation, person or result is shown.
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