Glossary

Capital costs to cash flow generated by the principal activity ratio

Capital costs / cash flow generated by the principal activity.

Capitalization to cash flow generated by the principal activity ratio (P/CF)

P/CF = the amount of capitalization / cash flow generated by the principal activity.

P/CF (Price to Cash Flow ratio). Its small values may mean that a company has a lot of free cash left that may be used, for instance, for paying dididends or buying out shares, thus increasing the incomes of the shareholders.

Capitalization to total sales receipts ratio (P/S)

P/S = the amount of capitalization / total sales receipts.

The price/revenues ratio (P/S ratio) is a financial indicator equaling the ratio between the market capitalization of a company and its annual revenues. This indicator is among the basic indicators used for comparing the investment-wise attractiveness of public companies. Supposedly, the comparison may be done within a homogenious industry where reasonableinvestors expect revenues to generate according profits or cash flow. Small values of this indicator mean that the company in question is underestimated, while large number mean it is overestimated.

Corrected EBITDA

Corrected EBITDA = a company's EBITDA - its income received from subsidiaries + shares in EBITDA of subsidiaries.

Corrected EBITDA norm

Corrected EBITDA norm = EBITDA / Earnings.

Current liquidity ratio

Current liquidity ratio = circulating assets / current liabilities.

This shows whether a company has enough resources that may be used for repaying short-term debt. The lower number shows that a company has at least enough circulating assets to cover its short-term debt so as not to be threatened by bankruptcy. Having circulating assets exceeding debt more than3 times is also undesirable, illustrating the irrational structure of the assets.