MILD I H B R D: Modified Internal Hybrid Ratio of Debt Explained

MILD I H B R D stands for Modified Internal Hybrid Ratio of Debt, a financial metric assessing a company's ability to cover both interest and principal payments from operating cash flow.

Formula

MILD I H B R D = (EBITDA + Depreciation & Amortization) / (Interest Expense + Principal Repayments)

Components

• EBITDA – Earnings before interest, taxes, depreciation, amortization
• D&A – Non‑cash charges for asset wear and intangible amortization
• Interest Expense – Cost of borrowed funds
• Principal Repayments – Scheduled debt principal payments

Interpretation

• Ratio > 1 – Company can comfortably meet debt obligations.
• Ratio < 1 – Potential difficulty servicing debt; higher default risk.

Thresholds vary by industry, company size, and lender risk appetite. Use alongside other metrics (debt‑to‑equity, interest coverage, cash‑flow‑to‑debt) for comprehensive analysis.