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PPP Case Study 6

Product: PPP Case Study 6

Author: Alastair Day
Company: Systematic Finance plc
Telephone: +44 (0)1483 532929
Fax: +44 (0)1483 538358
Email: info@system.co.uk

Objective: PPP Case Study 6

Version: v1.0 1-Jan-2001
Units: $0

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Notes: Select a schedule as above

You can enter all data on all blue cells

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 Model

PPP Case Study 6

v1.0 1-Jan-2001

Staff Numbers: 15,000 Results Units: $0

Cost per Head: 30,000 Net Present Value 6.00%: 12,776,778
Staff Savings: 12.00% Percentage of Annual Payments: 21.12%
Equipment per Employee: 2,000
Replacement Period: 5.0 years Management Tests
Maintenance: 10.00% Savings 20.00% Yes
Annual Payments: 60,000,000
Equipment Changes: 500,000
Discount Rate: 6.00%

Year Input Reference - 1 2 3 4 5 6 7 8 9 10

Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11

Phasing: 50.00% 100.00%

Procurement: - -
Contract Management: 1,000,000 250,000 500,000

(A) Non-adjusted costs and savings

Staff Costs Nos * Cost * Percent - 27,000,000 54,000,000 54,000,000 54,000,000 54,000,000 54,000,000 54,000,000 54,000,000 54,000,000 54,000,000

Hardware and Software [(Nos * Equipment) / Period] - 3,000,000 6,000,000 6,000,000 6,000,000 6,000,000 6,000,000 6,000,000 6,000,000 6,000,000 6,000,000

Maintenance Nos * Equipment * Saving - 1,500,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000

Contract Management Mgt Fee (1,000,000) (250,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000)

Contractor and Lease Fees Annual Pmts - (30,000,000) (60,000,000) (60,000,000) (60,000,000) (60,000,000) (60,000,000) (60,000,000) (60,000,000) (60,000,000) (60,000,000)
Annual Changes Equipment Changes - (250,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000)

Total (1,000,000) 1,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000

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Model : Page
 Model

PPP Case Study 6

v1.0 1-Jan-2001

(C) Sensitivity Units: $0

Staff Savings at 12.0% equals 12,776,778

0.50% 9.0% 9.50% 10.00% 10.50% 11.00% 11.50% 12.00% 12.50% 13.00% 13.50% 14.00% 14.50%
12,776,778 (80,216,473) (64,717,598) (49,218,723) (33,719,847) (18,220,972) (2,722,097) 12,776,778 28,275,653 43,774,528 59,273,403 74,772,278 90,271,153

Staff Savings at 12.0% equals 12,776,778

90,271,153
100,000,000
74,772,278
80,000,000 59,273,403
60,000,000 43,774,528
40,000,000 28,275,653
12,776,778
20,000,000 (2,722,097)
- (18,220,972)
(20,000,000) (33,719,847)
(49,218,723)
(40,000,000)
(64,717,598)
(60,000,000)
(80,216,473)
(80,000,000)
(100,000,000)
9.0% 9.5% 10.0% 10.5% 11.0% 11.5% 12.0% 12.5% 13.0% 13.5% 14.0% 14.5%

Discount Rate at 6.00% equals 12,776,778

0.50% 5.0% 5.50% 6.00% 6.50% 7.00% 7.50% 8.00% 8.50% 9.00% 9.50% 10.00% 10.50%
12,776,778 13,491,089 13,127,384 12,776,778 12,438,693 12,112,584 11,797,929 11,494,237 11,201,037 10,917,884 10,644,354 10,380,043 10,124,568

Discount Rate at 6.00% equals 12,776,778

16,000,000

14,000,000
13,491,089
12,000,000 13,127,384 12,776,778 12,438,693 12,112,584 11,797,929
10,000,000 11,494,237 11,201,037 10,917,884 10,644,354 10,380,043 10,124,568
8,000,000

6,000,000

4,000,000

2,000,000

-
5.0% 5.5% 6.0% 6.5% 7.0% 7.5% 8.0% 8.5% 9.0% 9.5% 10.0% 10.5%

© Systematic Finance plc : Tel +44 (0)1483 532929

Model : Page
 Base Case

15000
30000
0.12
2000
5
0.1
60000000
500000

36526

0.5 1

1000000 250000 500000

0.005 0.09

Page 4
 Base Case

0.005 0.05

0.0025
0.05
5

Page 5
 Reduced Savings

0.11

Page 6
 Increased Equipment Cost

2250

Page 7
 Optimistic Case

15000
30000
0.13
2000
5
0.12
59000000
400000

36526

0.5 1

1000000 250000 500000

0.005 0.09

Page 8
 Optimistic Case

0.005 0.05

0.0025
0.05
5

Page 9
 Pssimistic Case

15000
25000
0.1
1750
5
0.08
62000000
600000

36526

0.5 1

1000000 250000 500000

0.005 0.09

Page 10
 Pssimistic Case

0.005 0.05

0.0025
0.05
5

Page 11
 Scenario Summary

Scenario Summary
Increased
Current Values: Base Case Reduced Savings Optimistic Case Pessimistic Case
Equipment Cost
Changing Cells:
$C$5 15,000 15,000 15,000 15,000 15,000 15,000
$C$6 25,000 30,000 25,000 25,000 30,000 25,000
$C$7 10.00% 12.00% 11.00% 10.00% 13.00% 10.00%
$C$8 1,750 2,000 1,750 2,250 2,000 1,750
$C$9 5.0 years 5.0 years 5.0 years 5.0 years 5.0 years 5.0 years
$C$10 8.00% 10.00% 8.00% 8.00% 12.00% 8.00%
$C$11 62,000,000 60,000,000 62,000,000 62,000,000 59,000,000 62,000,000
$C$12 600,000 500,000 600,000 600,000 400,000 600,000
$D$16 Jan-01 Jan-01 Jan-01 Feb-01 Jan-01 Feb-01
$E$18 50.00% 50.00% 50.00% 50.00% 50.00% 50.00%
$F$18 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
$D$20 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000
$E$20 250,000 250,000 250,000 250,000 250,000 250,000
$F$20 500,000 500,000 500,000 500,000 500,000 500,000
$B$41 0.50% 0.50% 0.50% 0.50% 0.50% 0.50%
$C$41 9.0% 9.0% 9.0% 9.0% 9.0% 9.0%
$B$62 0.50% 0.50% 0.50% 0.50% 0.50% 0.50%
$C$62 5.0% 5.0% 5.0% 5.0% 5.0% 5.0%
$C$87 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%
$C$88 5.00% 5.00% 5.00% 5.00% 5.00% 5.00%
$C$89 5 5 5 5 5 5
Result Cells:
$G$6 (126,713,098) 12,776,778 (100,881,640) (112,247,481) 55,484,789 (126,713,098)
$G$7 -202.42% 21.12% -161.15% -179.31% 93.41% -202.42%
$G$10 No Yes No No Yes No
Notes: Current Values column represents values of changing cells at
time Scenario Summary Report was created. Changing cells for each
scenario are highlighted in gray.

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Scenario Summary : Page

 Explanation

Explanation
v1.0 1-Jan-2001

Notes

This is a demonstration file to show the benefits of design and some of the features in Excel. In particular:

Design planning
Layout - inputs, calculation, outputs, reports, summaries
Break into many worksheets
Formats
Number formats
Lines and borders
Colour
Specific colour for inputs and results
Controls - combo boxes and buttons
Data validation
Conditional formatting
Use of functions
Text labels
Graphics
Dynamic graphs to plot individual lines
Show workings separately
Plan for change - modular approach
Record a version number, author etc
Document methodology on separate sheet
Use names to make formulae easier
Paste a names table as part of documentation
Comment cells
Menu structure

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Explanation : Page
Names List

Author =Notes!$C$7
Company =Notes!$C$8
Contact =Notes!$B$27
Email =Notes!$C$11
Fax =Notes!$C$10
Objective =Notes!$C$13
Product =Notes!$C$6
Telephone =Notes!$C$9
Units =Notes!$C$15
Version =Notes!$C$14