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    FIN447 Seminar 4 Part II

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    Нямцэрэн Хулан
    This document outlines revenue projections for a company over several years. It projects sales volume and pricing increases annually, resulting in revenue growth ranging from 3-6% per year. It also shows unlevered free cash flow, weighted average cost of capital calculations, valuation using a perpetuity growth model, and present/future value calculations. Key details include projected revenue of $15.1 million in year 1 growing to $15.3 million by year 5, a WACC of 8.8%, and an enterprise valuation range using a perpetuity growth rate of 3%.

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    FIN447 Seminar 4 Part II

    Uploaded by

    Нямцэрэн Хулан
    14 views11 pages
    This document outlines revenue projections for a company over several years. It projects sales volume and pricing increases annually, resulting in revenue growth ranging from 3-6% per year. It also shows unlevered free cash flow, weighted average cost of capital calculations, valuation using a perpetuity growth model, and present/future value calculations. Key details include projected revenue of $15.1 million in year 1 growing to $15.3 million by year 5, a WACC of 8.8%, and an enterprise valuation range using a perpetuity growth rate of 3%.

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    This document outlines revenue projections for a company over several years. It projects sales volume and pricing increases annually, resulting in revenue growth ranging from 3-6% per year. It also shows unlevered free cash flow, weighted average cost of capital calculations, valuation using a perpetuity growth model, and present/future value calculations. Key details include projected revenue of $15.1 million in year 1 growing to $15.3 million by year 5, a WACC of 8.8%, and an enterprise valuation range using a perpetuity growth rate of 3%.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    14 views11 pages

    FIN447 Seminar 4 Part II

    Uploaded by

    Нямцэрэн Хулан
    This document outlines revenue projections for a company over several years. It projects sales volume and pricing increases annually, resulting in revenue growth ranging from 3-6% per year. It also shows unlevered free cash flow, weighted average cost of capital calculations, valuation using a perpetuity growth model, and present/future value calculations. Key details include projected revenue of $15.1 million in year 1 growing to $15.3 million by year 5, a WACC of 8.8%, and an enterprise valuation range using a perpetuity growth rate of 3%.

    Copyright:

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    of 11

    Revenue Schedule

    All figures in USD thousands unless stated 2020A 2021A 2022A 2023F 2024F 2025F 2026F 2027F Term

    Days in Period 365 365 365 365 365 365 365 365 365 365
    Plant Capacity 2,000

    OPERATIONS

    Sales Volume Growth 3.7% 6.3% 4.0% 3.0% 3.0% 2.0% 1.0% 1.0%

    Sales Volume (Units/Day) 1,519 1,575 1,675


    Plant Capacity (Units/Day) 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000
    Operational Efficiency 75.9% 78.8% 83.8% – – – – – 0.0%

    VOLUME

    Days in Period
    Sales Volume (Units/Day)
    Sales Volume (Units)

    PRICING

    Pricing Increases 14.9% 9.4% 5.0% 4.0% 3.0% 2.0% 1.0% 0.5%
    Unit Price (USD/Unit) 27.85 32.00 35.00 36.75 38.22 39.37 40.15 40.56 40.76

    REVENUE

    Sales Volume (Units)


    Sales Price (USD/Unit)
    Revenue
    Unlevered Free Cash Flow

    All figures in USD thousands unless stated Year 1 Year 2

    Revenue 15,123
    Revenue Growth 10.0%

    EBITDA
    EBITDA Margin 28.0% 29.0%

    Depreciation 1,200 1,250

    Operating Profit

    Tax Rate 20.0% 20.0%

    Capex
    Capex / Revenue 9.0% 9.0%

    UNLEVERED FREE CASH FLOW

    EBITDA
    Current Taxes
    Capital Expenditure 1
    Cash from Working Capital 341 (325)
    Unlevered Free Cash Flow

    Assume 9.0% of revenue for capex.⁽¹⁾


    Year 3 Year 4 Year 5

    8.0% 6.0% 4.0%

    30.0% 31.0% 31.0%

    1,300 1,300 1,350

    20.0% 20.0% 20.0%

    9.0% 9.0% 9.0%

    387 (301) (390)


    Valuation – Perpetuity Growth

    All figures in USD thousands unless stated Year 1 Year 2 Year 3

    Unlevered Free Cash Flow 10,101 12,159 13,859

    Perpetuity Growth Rate 2.0%


    WACC 10.0%

    Discrete Forecast
    Terminal Value
    Total Cash Flow

    Discounted Cash Flow (Manual Method)

    Enterprise Value
    Year 4 Year 5 Term

    14,602 15,040 15,341


    Weighted Average Cost of Capital

    Capital Structure

    Current Target
    Total Debt 45,000 30.0%
    Market Capitalization 86,029
    Total Capitalization

    After-tax cost of debt 5.50%


    Cost of equity 9.30%
    Current Target
    WACC
    Cost of Equity

    Unlevered Beta 1.10


    Levered Beta 1.40
    Risk-free Rate 4.50%
    Market Risk Premium 5.30%
    Country Risk Premium 3.50%
    Cost of Equity
    Present Value and Future Value

    All figures in USD thousands unless stated

    Year 0 Year 1 Year 2 Year 3


    Cash Flow – – – –
    Discount Rate 8.0%
    Present Value 1

    Year 0 Year 1 Year 2 Year 3


    Cash Flow 20,000 – – –
    Discount Rate 10.0%
    Future Value 2

    Present Value as of Year 0. ⁽¹⁾


    Assume a 10-Year Investment Horizon. ⁽²⁾
    Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
    – – – 50,000 – – –

    Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10


    – – – – – – –
    Valuation – Perpetuity Growth

    All figures in USD thousands unless stated Cash Flow Timing 22/06/30

    Perpetuity Growth Rate 3.0%


    WACC 8.8%

    Unlevered Free Cash Flow

    Discrete Forecast –
    Terminal Value –
    Total Cash Flow –

    Enterprise Value (XNPV Method)


    23/06/30 24/06/30 25/06/30 26/06/30 27/06/30 28/06/30

    42,595 45,044 47,071 48,954 50,912 52,439

    – – – –

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