Levered free cash flow shows what equity holders could receive after the company meets its debt obligations. A company with high debt can have strong unlevered but weak levered FCF.
How to use the Levered Free Cash Flow Calculator
- EBITDA
- Increase in net working capital
- Capital expenditure
- Mandatory debt payments
- Taxes paid
Results update as you type, and every field accepts the units shown in its menu.
How it works
Enter EBITDA, the change in working capital, capital expenditure and mandatory debt payments.
Tips
- Use consistent periods (a year or a quarter) for flow figures and period-end values for balances.
- Average opening and closing balances when a ratio mixes a flow with a stock.
- Benchmark against competitors in the same industry.
- Read the ratio together with others – profitability, liquidity and efficiency tell different stories.
Common mistakes to avoid
- Using sales instead of cost of goods sold for inventory ratios.
- Mixing gross, operating and net profit.
- Ignoring one-off items that distort a single year.
Inputs explained
| Field | What to enter |
|---|---|
| EBITDA | Amount in your currency |
| Increase in net working capital | Amount in your currency |
| Capital expenditure | Amount in your currency |
| Mandatory debt payments | Amount in your currency |
| Taxes paid | Amount in your currency |
Example values
How the main result changes when EBITDA changes and everything else stays at the example values above:
| EBITDA | Levered free cash flow |
|---|---|
| 400,000 | -170,000 |
| 600,000 | 30,000 |
| 800,000 | 230,000 |
| 1,000,000 | 430,000 |
| 1,200,000 | 630,000 |
| 1,600,000 | 1,030,000 |
Formula
Levered FCF = EBITDA − change in working capital − capex − mandatory debt payments (interest + principal)Worked example
Inputs — EBITDA: $800,000; Increase in net working capital: $50,000; Capital expenditure: $250,000; Mandatory debt payments: $180,000; Taxes paid: $90,000.
Results — Levered free cash flow = $230,000.00.
Frequently asked questions
What is levered free cash flow?
Cash flow after all obligations including debt payments.
How is it different from unlevered FCF?
Unlevered FCF is before interest and debt repayments.
Can levered FCF be negative?
Yes – e.g. during heavy investment or high debt service.
What formula does the Levered Free Cash Flow Calculator use?
Levered FCF = EBITDA − change in working capital − capex − mandatory debt payments (interest + principal).