The European Securities and Markets Authority (ESMA) has issued guidelines on Alternative Performance Measures (APMs) for listed issuers. The guidelines set out a common approach towards the use of APMs and are expected to benefit investors and to promote market confidence.

An APM is a financial measure of historical or future financial performance, financial position, or cash flows, other than a financial measure defined or specified in the applicable financial reporting framework. Examples of APMs include: operating earnings, cash earnings, earnings before one-time charges, earnings before interest, taxes, depreciation and amortisation (EBITDA), net debt, statements of financial position and statements of cash flow.

Measures such as revenue, profit or loss and earnings per share are, by definition, excluded from the guidelines.

The guidelines apply to APMs disclosed by issuers or persons responsible for a prospectus when publishing regulated information or prospectuses on or after 3 July 2016.