Date: Thu, 18 Dec 1997 01:49:33 GMT Server: Apache/1.2b1 Connection: close Content-Type: text/html Last-Modified: Wed, 22 Oct 1997 11:52:43 GMT ETag: "10011-ffe-344de90b" Content-Length: 4094 Accept-Ranges: bytes SPX Corporation -- EVA terms

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TERMS YOU WILL SEE
ALONG THE WAY

Capital - money invested in the net assets employed in the business.

Cost of Capital - the cost of debt (borrowed money) and the cost of equity at the predetermined cost. SPX's cost of capital for 1996 is 11%.

EVA - economic value added is the economic profit after subtracting the cost of all capital employed in the business.

EVA Drivers - actions that influence EVA. Key drivers are to grow, improve efficiencies, and to reallocate capital.

Excess Improvement - the improvement in EVA in excess of the expected improvement.

Expected Improvement (EI) - the improvement in EVA required to meet investor expectations implicit in our share price.

NOPAT - net operating profit after taxes adjusted using SPX's definition of EVA.

Value Creation - creating market value in excess of book value. Creating economic profit after subtracting the cost of all capital employed.




EVA is a registered trademark of Stern Stewart & Co.

Copyright © SPX Corporation 1996