What is Net Financial Debt?
Net Financial Debt is a company’s non-operational debt that considers cash and short-term securities against financial debt.
How to calculate Net Financial Debt
ƒ Sum(Long Term Debt + Current Portion Debt + Dividends Payable + Notes Payable - Cash) + (Short Term Investments)
More about this metric
Net Financial Debt allows the company to count its cash and short-term securities as credit towards their financial debt. This allows the company to see a clearer picture of their actual financial debt.
Ken Faulkenberry has written a good article on Net Financial Debt and why it's an important liquidity and leverage metric to understand.
Metrics related to Net Financial Debt