I have read that the formula for LFCF is
EBITDA - change in NWC - capex - mandatory debt repayments
However, why do you not account for taxes in this formula? In the formula for unlevered FCF, you take taxes off after getting to EBIT. Confused why not the same here. Thanks!
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Your formula is incorrect. You should obviously account for taxes
And of course you also need to consider interest payments and not only debt repayments
Doesn't LFCF start with net income since we are only looking at shareholders?
…Nvm, I just learnt you could start from EBITDA as well😂. However, you still need to account for taxes
You absolutely tax-effect your cash flows for the LFCF calc as well. Not sure where you picked up this wouldn't be the case but yes, you should take out tax for LFCF.
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