EBITDA or net profit: which one a grant panel wants to see

Grant and investor plans often show a single “profit” figure without saying which one it is. Reviewers notice. Using the right measure, and showing how you got it, makes your projections easier to trust.

What each one means

• Gross profit: revenue minus the direct cost of making what you sell (raw materials, production labour, energy for production).
• EBITDA: gross profit minus operating costs such as salaries, rent and admin. It leaves out depreciation and amortisation, and financing and tax items.
• Net profit: what remains after everything, including depreciation and tax.

A worked example

Why panels often look at EBITDA

EBITDA shows how much cash the operation itself generates before accounting choices and tax. That makes it a fair way to compare businesses of different sizes, and a simple way to estimate payback: a ₦25,000,000 project producing ₦8,986,500 of EBITDA a year recovers its cost in about 2.8 years.

When net profit matters

Net profit matters when the reader cares about the full picture, including depreciation on the equipment you are buying and tax. Equity investors in particular will want both. Showing EBITDA in the summary and net profit in the detailed projections is a sensible approach.

Show your working

Whatever you report, show the inputs: output, operating days, price, cost of goods as a percentage and operating costs. Panels trust numbers they can recalculate. They distrust a single impressive figure with no route to it.

DocuCraft calculates these figures in code from your answers, not with AI, so the numbers in your text always match the model.

Try it free: 5 projects, no card. You only sign in with your email when you start.