EBITDA

EBITDA strips out financing costs, tax, and non-cash charges to reveal the underlying operating performance of the agency. Because recruitment businesses are usually light on fixed assets, EBITDA often tracks closely to operating cash flow and is therefore the most common profit metric used in valuations.

Buyers typically adjust the headline figure for one-off or non-recurring costs (for example, owner's discretionary spend, exceptional legal fees, or COVID-related grants) to arrive at adjusted EBITDA, the benchmark against which market multiples are applied.