Exhibit 7.6 Ratio Values for Different Credit Ratings* EBITA/ EBITA EBITA/ Oper (FFO + Int Avg AT Margin Int Exp Margin Exp)/Int Exp FFOI RCF/Net Debt Debt Debt/ Debt/ CAPEX/ Rev EBITDA Book Cap Dep Exp Vol 1.6 36.0 21.1 13.8 0.9 1.3 8.6 6.5 1.6 Aaa ........ Aa ... A............ Baa .... Ba.......... B............. Caa-C...... 35.7 21.1 13.4 7.2 10.4 16.0% 14.3% 13.6% 10.3% 8.6% 6.7% 5.6% 22.8% 21.4% 19.4% 15.1% 12.2% 9.7% 5.9% 19.0% 19.2% 16.8% 14.0% 10.9% 8.1% 5.4% 8.4 86.3% 62.7% 46.1% 31.0% 22.4% 13.6% 3.4% 81.5% 33.8% 38.8% 28.1% 22.6% 13.3% 3.4% 23.7% 41.1% 39.3% 45.8% 50.1% 67.3% 99.1% 2.5 3.4 1.2 3.8 5.3 3.1 1.4 5.1 11.0 15.4 17.4 11.7 1.7 0.8 0.9 Calculating Ratios and Estimating Credit Rating The following data are from Under Armour's 2015 10-K report ($ thousands). Revenue Interest expense Tax expense Amortization expense Depreciation expense $3,963,313 Earnings from continuing operations $232,573 14,628 Capital expenditures (CAPEX) 298,928 154,112 Total debt 669,000 13,840 Average assets 2,481,992 87,100 a. Use the data above to calculate the following ratios: EBITA/Average assets, EBITA Margin, EBITA/Interest expenses, Debt/EBITDA, CAPEX/Depreciation Expense. b. Using the ratios you calculate in part a., estimate the credit rating that Moody's might assign to Under Armour. Refer to Exhibit 7.6 in the textbook for ratio definitions and credit ratings. Hint: Earnings from continuing operations is Under Armour's net income. Round answers to one decimal place (percentage ex: 0.2345 = 23.5%) Moody's rating EBITA/Avg. assets EBITA margin EBITA/Int. expense Debt/EBITDA CAPEX/Dep. expense Ratio 16.73 % * Aaa 10.47 % X B 289.4 x Aaa 15.8 x Aaa 7.1 x Aaa