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Calculation of FCFE and FCFF Years 1 2 3
Calculation of FCFE and FCFF Years 1 2 3
Calculation of FCFE and FCFF Years 1 2 3
Less:
Less:
Less:
Add:
Less:
Less:
Less:
Add:
Add:
Years
Revenues
Opertaing Expenses
Depreciation
EBIT
Interest
PBT
Taxes
PAT
Depreciation
CapEx
Changes in WC
Principal repayment
FCFE
Interest net of Taxes
Principal repayment
FCFF
Ke
WACC
Value of firm
Value of equity
1
4,000,000.00
3,100,000.00
300,000.00
600,000.00
650,000.00
(50,000.00)
(50,000.00)
300,000.00
350,000.00
200,000.00
600,000.00
(900,000.00)
390,000.00
600,000.00
90,000.00
25.50%
24.22%
22.67%
15.75%
15.11%
14.33%
77,753.78
94,942.87
95,495.45
-717131.474104 -530815.590373 -403973.598306
5
Terminal Value
6,996,025.00
7,695,627.50
5,421,919.38
5,964,111.31
524,701.88
577,172.06
1,049,403.75
1,154,344.13
410,000.00
350,000.00
639,403.75
804,344.13
255,761.50
321,737.65
383,642.25
482,606.48
524,701.88
577,172.06
612,152.19
673,367.41
349,801.25
384,781.38
600,000.00
(653,609.31)
1,629.76
246,000.00
210,000.00
600,000.00
192,390.69
211,629.76
21.08%
19.62%
13.54%
12.81%
96,725.54
5,011,564.85
-308682.471745 -229010.638676
18.42%
12.21%
Value of the firm:
5,376,482.49
(2,189,613.77)
Add:
Calculation of DE ratio
Years
1
Debt
5,900,000.00
2
5,300,000.00
3
4,700,000.00
Equity
PAT
Total Equity
1,950,000.00
60,000.00
2,010,000.00
2,010,000.00
158,100.00
2,168,100.00
Years
Ke
weight of equity
Kd
weight of debt
Beta
DE Ratio
WACC
2,000,000.00
(50,000.00)
1,950,000.00
1
25.50%
0.5
6%
0.5
3
3.03
15.75%
2
24.22%
0.5
6%
0.5
2.77
2.64
15.11%
3
22.67%
0.5
6%
0.5
2.49
2.17
14.33%
4
4,100,000.00
5 Terminal Year
3,500,000.00
2,900,000.00
2,168,100.00
265,515.00
2,433,615.00
2,433,615.00
383,642.25
2,817,257.25
4
21.08%
0.5
6%
0.5
2.20
1.68
13.54%
2,817,257.25
482,606.48
3,299,863.73
5
Terminal Year
19.62%
18.42%
0.5
0.5
6%
6%
0.5
0.5
1.93
1.71
1.24
0.88
12.81%
12.21%
Revenues
Operating Expenses
Base Year
4,000,000.00
3,100,000.00
15%
10%
350,000.00
300,000.00
WC Charge (% of
revenue)
Interest on debt
Principal repayment
each year during
forecast period
Financing Structure
Debt
Equity
Beta
Ke
Rp
D/E
Tax Rate
5%
10%
600,000.00
6,500,000.00
2,000,000.00
3
25.50%
5.50%
0.5
40%
Less:
Years
Opening Balance
Repayment
Closing Balance
Interest Calculation
1
6,500,000.00
600,000.00
5,900,000.00
650,000.00
2
5,900,000.00
600,000.00
5,300,000.00
590,000.00
3
5,300,000.00
600,000.00
4,700,000.00
530,000.00
4
4,700,000.00
600,000.00
4,100,000.00
470,000.00
5 Terminal Year
4,100,000.00
3,500,000.00
600,000.00
600,000.00
3,500,000.00
2,900,000.00
410,000.00
350,000.00
19,366.11
9,585,756.83