EBITDA

 Generally speaking, a "good" overall EBITDA margin falls between 15% and 25%. However, a healthy margin depends heavily on your specific industry. An acceptable or strong percentage for a software company differs vastly from a grocery store or a heavy manufacturing plant. [1, 2, 3]

A 15% EBITDA means a company's earnings before interest, taxes, depreciation, and amortization equal 15% of its total revenue. If a business makes $1,000,000 in sales, a 15% EBITDA margin leaves $150,000 in core operational profit before accounting for financing or tax choices

General Benchmarks

Above 10%: Generally perceived as positive and healthy for many standard businesses.
15% to 25%: Considered strong and efficient across a broad range of sectors.
Above 30%: Signifies elite operational efficiency or strong market pricing power. [1, 2, 3, 4, 5]

Industry Differences

Software / SaaS: 15% to 25% is average, while top performers reach 30% to 40%+.
Manufacturing: 10% to 15% is typical.
Retail / Grocery: 5% to 10% is common due to low product markup and high volume.
Telecommunications / Utilities: 30% to 50% is standard due to high initial infrastructure and heavy capital layouts.
Restaurants / Hospitality: 10% to 20% is normal.
Banks - EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) is not a standard or meaningful metric applied to banks like Westpac Banking Corp (ASX: WBC). Because interest expense and interest income form the core revenue-generating operations of financial institutions, traditional EBITDA margins are generally not tracked or reported for banks. [1, 2, 3, 4]
Instead, analysts evaluate bank profitability using metrics like Net Interest Margin (NIM), Return on Equity (ROE), and Net Profit Margin. [1, 2, 3]
Alternative Profitability Metrics (Recent Years)
For context on Westpac's recent financial performance, standard percentage metrics run approximately as follows:
Net Profit Margin: ~30% to 32% over recent fiscal years.
Return on Equity (ROE): ~7.7% to 10.2% over recent fiscal years.
Operating Margin: ~51%. [1, 2, 3]


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amortization




Amortization means spreading out a single large amount into smaller, regular payments or costs over a set period. In finance and accounting, it has two major uses: paying off a loan over time, or spreading out the cost of an intangible business asset. [1]
Loan Amortization
Paying off debt: You make regular, scheduled payments to clear a loan (like a home mortgage or car loan).
Principal and interest: Each payment covers both interest and the original loan amount (principal).
Shifting balance: Early payments go mostly toward interest. Later payments go mostly toward paying down the actual loan amount. [1, 2]
Accounting Amortization
Intangible assets: Businesses use it to spread the purchase cost of non-physical items (like patents, copyrights, or software licenses) over the years those items will be used. [1]
Matching costs: Instead of taking a huge financial hit all at once, the cost is written off gradually in each accounting period. [1]
Depreciation vs. amortization: Amortization applies to intangible (non-physical) assets, while depreciation applies to tangible (physical) assets like buildings or machinery. [1]