Sales last year Growth

1,400,000,000
14%
1,596,000,000
14%
1,819,440,000
14%
2,074,161,600
14%
2,364,544,224
14%

Increase
196,000,000
223,440,000
254,721,600
0290,382,624
331,036,191

Total sales for the

1,596,000,000 2011
1,819.440,000 2012
2,074,161,600 2013
2,364,544,224 2014
2,695,580,415 2015

Sales last year Growth

1,400,000,000
14%
1,596,000,000
14%
1,819,440,000
14%
2,074,161,600
14%
2,364,544,224
14%

Increase
196,000,000
223,440,000
254,721,600
290,382,624
331,036,191

Total sales for the

1,596,000,000
1,819,440,000
2,074,161,600
2,364,544,224
2,695,580,415

191,520,000
218,332,800
248,899,392
283,745,307
323,469,650

Sales Profit marginOperating profit

Tax rate Tax paid

After tax cash in

1,596,000,000

12%

2191,520,000

30% 57,456,000.00

134,064,000

1,819,440,000

14%

254,721,600

30% 76,416,480.00

176,305

2,074,161,600

16%

331,865,856

30% 99,559,756.80

232,306,099

2,364,544,224

18%

425,617,960 30% 127,685,388.10

297,932,572

2,695,580,415

20%

0539,116,083 30% 161,734,824.92

377,381,258

Sales growth Fixed Inv

196,000,000
223,440,000
254,721,600
290,382,624
331,036,191

18%
16%
14%
12%
10%

Cash out
35,280,000
35,750,400
35,661,024
34,845,915
33,103,619

Working Cap
investment cash out
12% 23,520,000
11% 24,578,400
10% 25,472,160
9% 26,134,430
8% 26,482,895

5,642,662,350

After tax cash in Fixed inv cash out

Working capital cash out

35,280,000
35,750,400
35,661,024
34,845,915
33,103,619

23,520,000
4,578,400
25,472,160
26,134,436
26,482,895

134,064,000

178,305,120
232,306,099
297,932,572
377,381,258

Free cash flow

75,264,000
117,976,320
171,172,915
236,952,221
317,794,744

Free cash flow

Discount rate
Pv office
75,264,000
0.9373 #########

Cumulative
70,545,891

117.976,320

0.8786 ######### #############

171,172,915

0.8235

236,952,221
317,794,744

0140,957,5 315.152,09
44
7
0.7719 ######### #############
0.7235 ######### #############

1
2
3
4
5

Tomacelli bid valuation

Key Value drivers for target company
Sales 2010
Forecast period
Sales growth rate per annum
Operating profit margin
Incremental fixed investment
Incremental working capital
Cash tax rate
Target capital structure
Debt
Equity
Gross cost of debt
Treasury bills rate
FTSE index
Estimated Beta factor
Total existing debt
No of shares
STAGE 1
Weighted average cost of capital
Net cost of debt
Cost of equity(CAPM)
Risk free rate
Risk premium
Beta adjustment
Cost of equity(CAPM)
WACC
Round up to nearest whole
Sheet1
STAGE 2
Calculating future turnover
Year
2010
2011
2012
2013
2014
STAGE 3
Calculating after tax inflow
Year

STAGE 4
Incremental investment needs
Year
2011
2012
2013
2014
2015
Sheet2
STAGES
Calculating the free cash flow
Year
2011
2012
2013
2014
2015
Sheet3
STAGE 6
Year
2011
2012
2013
2014
2015

STAGE 7
Calculating the residual value After lax cash in Cost of capital Residual value Discount rate Presen
Year

2015 377,381,258 6.69% 5,642,662.353 0.72347267 4,082,312,009 5

Calculating business value Cum PV of FCF PV of res vat Business value
Shareholder value
727,961,501
Business value
4,810,273,510
No of shares
2,000,000,000

4,082,312,009 4,810,273,510
less debt Corporate value
2,000,000,000 2,810,273,510
1.405136755
Plus investments Shareholder value
0 2,810,273,510
Tomacelli, TOMA2.XLS, 03/10/2011

1,400,000,000 Based on restructured company

5 years Any longer considered too uncertain
14.00 Based on revised pricing strategy
10% Increasing by 2% per annum
18% Decreasing by 2% per annum
12% Decreasing by 1% per annum
30% No change in govt policy
60%
40%
6.40%
6% Risk free
11% Total returns
0.8
2,000,000,000
2000000000

4.48%
6%
5%
0.8
10.0%
6.68800%
7%

0.0448

10.00%
6.69%

14.95215311
4.134678949
10.81747416
2011
2012
2013
2014
2015

After lax cash in Cost of capital Residual value Discount rate Present value

642,662.353 0.72347267 4,082,312,009 5

m PV of FCF PV of res vat Business value

share price (0)

0.9373