Strictly Private &

Confidential

Project Chicken Farm

Preliminary Financial
Information Memorandum
Project Economics – Draft (April 8, 2008)
Table of Contents

Section Page

Free Cash Flow 3

Profit and Loss 4
Balance Sheet 5
Ratios 6
Valuations 7
NPV, IRR & Payback 8
Assumptions & Parameters 9 &10
Revenue 11
Cost of Sales 12
Operating Expenses 13
Taxation 14
Working Capital 15
Capital Expenditure 16
Sources and Uses of Funds 17
Investment Cost for Chicken Coop 18

2
FREE CASH FLOW

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

RM RM RM RM RM RM RM RM RM RM RM

Revenue 3,356,160.00 3,456,844.80 3,560,550.14 3,667,366.65 3,777,387.65 3,890,709.28 4,007,430.56 4,127,653.47 4,251,483.08 4,379,027.57 4,510,398.40
Cost of sales (3,134,880.00) (3,192,840.00) (3,251,911.82) (3,312,117.23) (3,373,478.43) (3,436,018.03) (3,499,759.12) (3,564,725.25) (3,630,940.40) (3,698,429.07) (3,767,216.21)
Gross profit 221,280.00 264,004.80 308,638.32 355,249.41 403,909.22 454,691.25 507,671.43 562,928.22 620,542.67 680,598.50 743,182.19
Operating expenses (68,838.00) (72,912.00) (85,367.10) (88,742.96) (92,287.60) (96,009.48) (99,917.46) (104,020.83) (108,329.37) (112,853.34) (117,603.51)
Earnings before int, tax, dep & amot (EBITDA) 152,442.00 191,092.80 223,271.22 266,506.46 311,621.62 358,681.77 407,753.97 458,907.39 512,213.30 567,745.16 625,578.68
Tax on EBITDA (39,634.92) (47,773.20) (36,107.80) (46,916.61) (58,195.40) (69,960.44) (82,228.49) (95,016.85) (108,343.33) (122,226.29) (136,684.67)
Net Operating Profit After Tax (NOPAT) 112,807.08 143,319.60 187,163.41 219,589.84 253,426.21 288,721.32 325,525.48 363,890.55 403,869.98 445,518.87 488,894.01
Working capital (371,045.00) (10,262.14) (1,773.18) (10,588.09) (10,887.64) (11,195.82) (11,512.88) (11,839.07) (12,174.67) (12,519.94) (10,797.60)
Cash Flow From Operations (CFFO) (258,237.92) 133,057.46 185,390.23 209,001.76 242,538.57 277,525.50 314,012.60 352,051.47 391,695.31 432,998.93 478,096.41
Capex (938,400.00) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Gross Operating Free Cash Flow (GOFCF) (1,196,637.92) 133,057.46 185,390.23 209,001.76 242,538.57 277,525.50 314,012.60 352,051.47 391,695.31 432,998.93 478,096.41
Tax savings on interest 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Net Operating Free Cash Flow (NOFCF) (1,196,637.92) 133,057.46 185,390.23 209,001.76 242,538.57 277,525.50 314,012.60 352,051.47 391,695.31 432,998.93 478,096.41
Equity injection 5% 61,402 61,401.92 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Grant 95% 1,235,236 1,235,236.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total funds injected (grant & equity) 100% 1,296,638 1,296,637.92 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Cash available for debt service (CADS) 100,000.00 133,057.46 185,390.23 209,001.76 242,538.57 277,525.50 314,012.60 352,051.47 391,695.31 432,998.93 478,096.41
Debt service - Principal 0 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Debt service - Interest 0 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Debt service - Principal + Interest 0 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Cash available after debt service 100,000.00 133,057.46 185,390.23 209,001.76 242,538.57 277,525.50 314,012.60 352,051.47 391,695.31 432,998.93 478,096.41
Witholding taxes 0% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Equity Free Cash Flow (EFCF) 100,000.00 133,057.46 185,390.23 209,001.76 242,538.57 277,525.50 314,012.60 352,051.47 391,695.31 432,998.93 478,096.41
Dividends 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Net Cash Surplus / (Deficit) 100,000.00 133,057.46 185,390.23 209,001.76 242,538.57 277,525.50 314,012.60 352,051.47 391,695.31 432,998.93 478,096.41
Opening cash balance 0.00 100,000.00 233,057.46 418,447.69 627,449.45 869,988.02 1,147,513.52 1,461,526.12 1,813,577.59 2,205,272.90 2,638,271.83
Closing cash balance 100,000.00 233,057.46 418,447.69 627,449.45 869,988.02 1,147,513.52 1,461,526.12 1,813,577.59 2,205,272.90 2,638,271.83 3,116,368.24

3
PROFIT AND LOSS

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

RM RM RM RM RM RM RM RM RM RM RM

Revenue 3,356,160 3,456,845 3,560,550 3,667,367 3,777,388 3,890,709 4,007,431 4,127,653 4,251,483 4,379,028 4,510,398
Cost of sales (3,134,880) (3,192,840) (3,251,912) (3,312,117) (3,373,478) (3,436,018) (3,499,759) (3,564,725) (3,630,940) (3,698,429) (3,767,216)
Gross profit 221,280 264,005 308,638 355,249 403,909 454,691 507,671 562,928 620,543 680,598 743,182
Operating expenses (68,838) (72,912) (85,367) (88,743) (92,288) (96,009) (99,917) (104,021) (108,329) (112,853) (117,604)
Earnings before int, tax, dep & amot (EBITDA) 152,442 191,093 223,271 266,506 311,622 358,682 407,754 458,907 512,213 567,745 625,579
Depreciation 0 (157,680) (157,680) (157,680) (157,680) (157,680) 0 0 0 0 0
Earnings before interest & tax (EBIT) 152,442 33,413 65,591 108,826 153,942 201,002 407,754 458,907 512,213 567,745 625,579
Interest income 0 0 0 0 0 0 0 0 0 0 0
152,442 33,413 65,591 108,826 153,942 201,002 407,754 458,907 512,213 567,745 625,579
Interest expense 0 0 0 0 0 0 0 0 0 0 0
Earnings before tax (EBT) 152,442 33,413 65,591 108,826 153,942 201,002 407,754 458,907 512,213 567,745 625,579
Taxation (Including Witholding Taxes) (39,635) (47,773) (36,108) (46,917) (58,195) (69,960) (82,228) (95,017) (108,343) (122,226) (136,685)
Earnings after tax (EAT) 112,807 (14,360) 29,483 61,910 95,746 131,041 325,525 363,891 403,870 445,519 488,894

Retained Earnings/(Loss) B/F 0 112,807 98,447 127,930 189,840 285,586 416,627 742,153 1,106,044 1,509,913 1,955,432
Earnings after tax (EAT) 112,807 (14,360) 29,483 61,910 95,746 131,041 325,525 363,891 403,870 445,519 488,894
112,807 98,447 127,930 189,840 285,586 416,627 742,153 1,106,044 1,509,913 1,955,432 2,444,326
Dividends 0 0 0 0 0 0 0 0 0 0 0
Retained Earnings/(Loss) C/F 112,807 98,447 127,930 189,840 285,586 416,627 742,153 1,106,044 1,509,913 1,955,432 2,444,326

Dividend Payout Ratio 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%

4
BALANCE SHEET

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

RM RM RM RM RM RM RM RM RM RM RM

FIXED ASSETS (NBV)

Coop 788,400 630,720 473,040 315,360 157,680 0 0 0 0 0 0
Land 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000
938,400 780,720 623,040 465,360 307,680 150,000 150,000 150,000 150,000 150,000 150,000
CURRENT ASSETS
Trade receivables 284,124 292,648 292,648 301,427 310,470 319,784 329,378 339,259 349,437 359,920 370,718
Inventories 86,921 88,659 90,432 92,241 94,086 95,968 97,887 99,845 101,842 103,878 103,878
Cash and Bank 100,000 233,057 418,448 627,449 869,988 1,147,514 1,461,526 1,813,578 2,205,273 2,638,272 3,116,368
471,045 614,365 801,528 1,021,118 1,274,544 1,563,265 1,888,791 2,252,681 2,656,551 3,102,070 3,590,964
CURRENT LIABILITIES (Non interest bearing)
Trade payables 0 0 0 0 0 0 0 0 0 0 0
Other payables 0 0 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0 0 0

NET WORKING CAPITAL 471,045 614,365 801,528 1,021,118 1,274,544 1,563,265 1,888,791 2,252,681 2,656,551 3,102,070 3,590,964
NET ASSETS 1,409,445 1,395,085 1,424,568 1,486,478 1,582,224 1,713,265 2,038,791 2,402,681 2,806,551 3,252,070 3,740,964

Financed by:
Share Capital 61,402 61,402 61,402 61,402 61,402 61,402 61,402 61,402 61,402 61,402 61,402
Government Grant 1,235,236 1,235,236 1,235,236 1,235,236 1,235,236 1,235,236 1,235,236 1,235,236 1,235,236 1,235,236 1,235,236
Retained Earnings/(Loss) C/F 112,807 98,447 127,930 189,840 285,586 416,627 742,153 1,106,044 1,509,913 1,955,432 2,444,326
SHAREHOLDERS' FUND 1,409,445 1,395,085 1,424,568 1,486,478 1,582,224 1,713,265 2,038,791 2,402,681 2,806,551 3,252,070 3,740,964
PREFERENCE DIVIDENDS 0 0 0 0 0 0 0 0 0 0 0
LONG TERM LIABILITES 0 0 0 0 0 0 0 0 0 0 0
EQUITY AND LONG TERM LIABILITIES 1,409,445 1,395,085 1,424,568 1,486,478 1,582,224 1,713,265 2,038,791 2,402,681 2,806,551 3,252,070 3,740,964

5
RATIOS

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Profit margins

Gross profit margin 7.6% 8.7% 9.7% 10.7% 11.7% 12.7% 13.6% 14.6% 15.5% 16.5%

EBITDA margin 5.5% 6.3% 7.3% 8.2% 9.2% 10.2% 11.1% 12.0% 13.0% 13.9%

NOPAT margin 4.1% 5.3% 6.0% 6.7% 7.4% 8.1% 8.8% 9.5% 10.2% 10.8%

GOFCF margin 3.8% 5.2% 5.7% 6.4% 7.1% 7.8% 8.5% 9.2% 9.9% 10.6%

Growth rates

Revenue 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0%
Cost of sales 1.8% 1.9% 1.9% 1.9% 1.9% 1.9% 1.9% 1.9% 1.9% 1.9%
Operating expenses 5.9% 17.1% 4.0% 4.0% 4.0% 4.1% 4.1% 4.1% 4.2% 4.2%
Earnings before int, tax, dep & amot (EBITDA) 25.4% 16.8% 19.4% 16.9% 15.1% 13.7% 12.5% 11.6% 10.8% 10.2%
Net Operating Profit After Tax (NOPAT) 27.0% 30.6% 17.3% 15.4% 13.9% 12.7% 11.8% 11.0% 10.3% 9.7%

Cash Flow From Operations (CFFO) 0.0% 39.3% 12.7% 16.0% 14.4% 13.1% 12.1% 11.3% 10.5% 10.4%
Gross Operating Free Cash Flow (GOFCF) 0.0% 39.3% 12.7% 16.0% 14.4% 13.1% 12.1% 11.3% 10.5% 10.4%

6
VALUATION

Year
0
2008

EQUITY VALUE
RM
Forecast Period Value - Free Cash Flow (10 years) 1,109,787
Forecast Period Value - Tax Savings (10 years) 0
Total Forecast Period Value 1,109,787
Residual Value (Post forecast period value) 466,827
Total Business Value 1,576,614
Debt (Present Value) 0
Total Equity Value 1,576,614

Equity Funding Required 61,402

Percentage of Equity Placed (Floated) 3.89%

7
NPV & IRR

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

RM RM RM RM RM RM RM RM RM RM RM
Net present value (NPV)

Discount rate 0.0% 18.6% 18.6% 18.6% 18.6% 18.6% 18.6% 18.6% 18.6% 18.6% 18.6%

Period 1 2 3 4 5 6 7 8 9 10 11

Gross Operating Free Cash Flow (GOFCF) (1,196,638) 133,057 185,390 209,002 242,539 277,526 314,013 352,051 391,695 432,999 478,096

Cumalative GOFCF (1,196,638) (1,063,580) (878,190) (669,188) (426,650) (149,124) 164,888 516,940 908,635 1,341,634 1,819,730

Present value of GOFCF (1,196,638) 112,190 131,801 125,284 122,586 118,271 112,834 106,663 100,062 93,266 86,830

NPV (Cumulative discounted GOFCF) (1,196,638) (1,084,448) (952,647) (827,363) (704,777) (586,505) (473,672) (367,009) (266,946) (173,680) (86,850)

Payback period (years from commencement of operations) - - - - - - 6.53 8.47 10.32 12.10 13.81
Payback period (years from commencement of construction ) - - - - - - 6.53 - - - -

Project IRR -14% -4% 3% 8% 12% 15% 17%

Internal rate of return (IRR)

Gross Operating Free Cash Flow (GOFCF) (1,196,638) 133,057 185,390 209,002 242,539 277,526 314,013 352,051 391,695 432,999 478,096

Project IRR -30.5% -14.5% -3.9% 3.4% 8.5% 12.1% 14.9% 16.9%

8
ASSUMPTIONS & PARAMETERS

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Capital expenditure (Capex)

Chicken Coop RM 788,400

Land Cost - 3 acres RM 150,000
938,400

Selling price of products

Chicken RM / Per Chicken 4.00 4.12 4.24 4.37 4.50 4.64 4.78 4.92 5.07 5.22 5.38
Price of Raw Materials

Day Old Chickens RM / Per Chicken 1.20 1.22 1.25 1.27 1.30 1.32 1.35 1.38 1.41 1.43 1.46
Medicine RM / Per Chicken/Per cycle 0.45 0.46 0.47 0.48 0.49 0.50 0.51 0.52 0.53 0.54 0.55
Feeds RM / Per Chicken/ Per day 0.11 0.11 0.11 0.12 0.12 0.12 0.12 0.13 0.13 0.13 0.13

Other input / resource cost

Amneties and Maintenance RM/per day/per coop 450.00 454.50 459.05 463.64 468.27 472.95 477.68 482.46 487.29 492.16 497.08
Labour RM/per day/per coop 350.00 353.50 357.04 360.61 364.21 367.85 371.53 375.25 379.00 382.79 386.62
Transport RM/per chicken 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.06

Selling price escalation (inflation)

- Chicken @2.3kg 0.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0%

Cost escalation (inflation)

- Day Old Chicken 0.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%
- Medicine 0.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%
- Feeds 0.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%

- Amneties 0.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0%
- Labour 0.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0%
- Transport 0.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0%

9
ASSUMPTIONS & PARAMETERS

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Production Yield 95.0% 95.0% 95.0% 95.0% 95.0% 95.0% 95.0% 95.0% 95.0% 95.0% 95.0%

Production Days per Cycle (days) 45.0 45.0 45.0 45.0 45.0 45.0 45.0 45.0 45.0 45.0 45.0
Production Cycle cycles (each 45 days) 6.0 6.0 6.0 6.0 6.0 6.0 6.0 6.0 6.0 6.0 6.0
No of Coop Coops/cycle 2 2 2 2 2 2 2 2 2 2 2
Capacity Per Coop Chicken/Coop/cycle 32,000 32,000 32,000 32,000 32,000 32,000 32,000 32,000 32,000 32,000 32,000
Weight Per Chicken Kg/Chicken 2.30 2.30 2.30 2.30 2.30 2.30 2.30 2.30 2.30 2.30 2.30

Chicken Production Chicken per year 364,800 364,800 364,800 364,800 364,800 364,800 364,800 364,800 364,800 364,800 364,800

Taxation rate 26% 25% 25% 25% 25% 25% 25% 25% 25% 25% 25%

10
REVENUE

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Revenue
Chickens RM 3,356,160 3,456,845 3,560,550 3,667,367 3,777,388 3,890,709 4,007,431 4,127,653 4,251,483 4,379,028 4,510,398
Total Revenue RM 3,356,160 3,456,845 3,560,550 3,667,367 3,777,388 3,890,709 4,007,431 4,127,653 4,251,483 4,379,028 4,510,398

Selling price
Chicken @ 2.3 kg RM / Chicken 9.20 9.48 9.76 10.05 10.35 10.67 10.99 11.31 11.65 12.00 12.36

Production & sales volume

Optimum capacity Chicken/ Year 364,800 364,800 364,800 364,800 364,800 364,800 364,800 364,800 364,800 364,800 364,800

11
COST OF SALES

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

RAW MATERIALS
Price of Raw Materials

Day Old Chickens RM 460,800 470,016 479,416 489,005 498,785 508,760 518,936 529,314 539,901 550,699 561,713
Medicine RM 172,800 176,256 179,781 183,377 187,044 190,785 194,601 198,493 202,463 206,512 210,642
Feeds RM 1,900,800 1,938,816 1,977,592 2,017,144 2,057,487 2,098,637 2,140,610 2,183,422 2,227,090 2,271,632 2,317,065
RM 2,534,400 2,585,088 2,636,790 2,689,526 2,743,316 2,798,182 2,854,146 2,911,229 2,969,454 3,028,843 3,089,419

Other input / resource cost

Amneties and Maintenance RM 243,000 245,430 247,884 250,363 252,867 255,395 257,949 260,529 263,134 265,766 268,423
Labour RM 189,000 190,890 192,799 194,727 196,674 198,641 200,627 202,634 204,660 206,707 208,774
Transport RM 19,200 19,392 19,586 19,782 19,980 20,179 20,381 20,585 20,791 20,999 21,209
RM 451,200 455,712 460,269 464,872 469,521 474,216 478,958 483,747 488,585 493,471 498,406

Subtotal RM 2,985,600 3,040,800 3,097,059 3,154,397 3,212,837 3,272,398 3,333,104 3,394,976 3,458,038 3,522,313 3,587,825
Contingencies 5.0% RM 149,280 152,040 154,853 157,720 160,642 163,620 166,655 169,749 172,902 176,116 179,391
Cost of sales - Commercial production- Fertilizer RM 3,134,880 3,192,840 3,251,912 3,312,117 3,373,478 3,436,018 3,499,759 3,564,725 3,630,940 3,698,429 3,767,216

12
OPERATING EXPENSES

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

HR Expenses RM 33,600 35,280 37,044 38,896 40,841 42,883 45,027 47,279 49,643 52,125 54,731
Selling, General & Administration (SGA) Expenses RM 25,960 28,160 38,258 39,621 41,052 42,555 44,132 45,789 47,528 49,355 51,272
Insurance Expenses RM 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000
RM 65,560 69,440 81,302 84,517 87,893 91,438 95,159 99,067 103,171 107,479 112,003
Contingencies 5% RM 3,278 3,472 4,065 4,226 4,395 4,572 4,758 4,953 5,159 5,374 5,600
Operating Expenses RM 68,838 72,912 85,367 88,743 92,288 96,009 99,917 104,021 108,329 112,853 117,604

Selling, General & Administration (SGA) Expenses

Selling expenses

Cost escalation factor 5% 5% 5% 5% 5% 5% 5% 5% 5%

Travelling & accomodation 5,000 5,000 5,250 5,513 5,788 6,078 6,381 6,700 7,036 7,387 7,757
Transport 10,000 10,000 10,500 11,025 11,576 12,155 12,763 13,401 14,071 14,775 15,513
Communications 6,000 6,000 6,300 6,615 6,946 7,293 7,658 8,041 8,443 8,865 9,308
Entertainment 1,000 1,000 1,050 1,103 1,158 1,216 1,276 1,340 1,407 1,477 1,551
Total Selling expenses 22,000 22,000 23,100 24,255 25,468 26,741 28,078 29,482 30,956 32,504 34,129

General & Administrative expenses

Cost escalation factor 5% 5% 5% 5% 5% 5% 5% 5% 5%

Auditor's fee - 2,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000
Accounting charges 3,600 3,600 3,780 3,969 4,167 4,376 4,595 4,824 5,066 5,319 5,585
3,600 5,600 13,780 13,969 14,167 14,376 14,595 14,824 15,066 15,319 15,585
Contingencies 10% 360 560 1,378 1,397 1,417 1,438 1,459 1,482 1,507 1,532 1,558
Total General & Administrative expenses 3,960 6,160 15,158 15,366 15,584 15,813 16,054 16,307 16,572 16,851 17,143

Total SGA RM/Year 25,960 28,160 38,258 39,621 41,052 42,555 44,132 45,789 47,528 49,355 51,272

13
TAXATION

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Taxation
Depreciable assets b/f RM 0 788,400 788,400 709,560 630,720 551,880 473,040 394,200 315,360 236,520 157,680
Add: Allowable Capex RM
Chicken Coop RM 788,400 - 0 0 0 0 0 0 0 0 0
RM 788,400 788,400 788,400 709,560 630,720 551,880 473,040 394,200 315,360 236,520 157,680
Less: Tax depreciation 10% RM 0 0 (78,840) (78,840) (78,840) (78,840) (78,840) (78,840) (78,840) (78,840) (78,840)
Depreciable assets c/f RM 788,400 788,400 709,560 630,720 551,880 473,040 394,200 315,360 236,520 157,680 78,840

EBITDA RM 152,442 191,093 223,271 266,506 311,622 358,682 407,754 458,907 512,213 567,745 625,579
Add: Disallowed expenses 0% RM 0 0 0 0 0 0 0 0 0 0 0
Gross taxable income RM 152,442 191,093 223,271 266,506 311,622 358,682 407,754 458,907 512,213 567,745 625,579
Less: Tax depreciation RM 0 0 (78,840) (78,840) (78,840) (78,840) (78,840) (78,840) (78,840) (78,840) (78,840)
Net taxable income (excluding tax savings on interest) RM 152,442 191,093 144,431 187,666 232,782 279,842 328,914 380,067 433,373 488,905 546,739

Tax rate 26% 25% 25% 25% 25% 25% 25% 25% 25% 25% 25%

Tax payable on EBITDA RM 39,635 47,773 36,108 46,917 58,195 69,960 82,228 95,017 108,343 122,226 136,685

Tax payable on EBITDA RM 39,635 47,773 36,108 46,917 58,195 69,960 82,228 95,017 108,343 122,226 136,685
Tax payable on interest income RM 0 0 0 0 0 0 0 0 0 0 0
Tax savings on interest expense RM 0 0 0 0 0 0 0 0 0 0 0
Tax payable on Earnings Before Tax RM 39,635 47,773 36,108 46,917 58,195 69,960 82,228 95,017 108,343 122,226 136,685

14
WORKING CAPITAL & CAPEX

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Working capital

Average collection period (Rev days) 30 30 30 30 30 30 30 30 30 30 30

Average stockholding period - Day Old Chicken (COS days) 0 0 0 0 0 0 0 0 0 0 0

Average stockholding period - Medicine (COS days) 15 15 15 15 15 15 15 15 15 15 15
Average stockholding period - Feeds (COS days) 15 15 15 15 15 15 15 15 15 15 15
(days) 60 60 60 60 60 60 60 60 60 60 60
Average payment period (COS days) 0 0 0 0 0 0 0 0 0 0 0
Cash conversion cycle (days) 60 60 60 60 60 60 60 60 60 60 60

Trade receivables RM 284,124 292,648 292,648 301,427 310,470 319,784 329,378 339,259 349,437 359,920 370,718
Inventories - Day Old Chickens RM 0 0 0 0 0 0 0 0 0 0 0
Inventories - Medicine RM 7,243 7,388 7,536 7,687 7,840 7,997 8,157 8,320 8,487 8,657 8,657
Inventories - Feeds RM 79,677 81,271 82,896 84,554 86,245 87,970 89,730 91,524 93,355 95,222 95,222
RM 371,045 381,307 383,080 393,668 404,556 415,752 427,265 439,104 451,278 463,798 474,596
Trade payables RM 0 0 0 0 0 0 0 0 0 0 0
Net working capital RM 371,045 381,307 383,080 393,668 404,556 415,752 427,265 439,104 451,278 463,798 474,596

Working capital funding required RM 371,045 10,262 1,773 10,588 10,888 11,196 11,513 11,839 12,175 12,520 10,798

15
WORKING CAPITAL & CAPEX

Year Year Year Year Year Year Year Year Year Year Year
0 1 2 3 4 5 6 7 8 9 10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Capital expenditure (Capex)

Cost milestone
Coop 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Land 100% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%

Opening balance RM 0 938,400 938,400 938,400 938,400 938,400 938,400 938,400 938,400 938,400 938,400
Additions:
Coop RM 788,400 - - - - - - - - - -
Land RM 150,000 - - - - - - - - - -
938,400 0 0 0 0 0 0 0 0 0 0

RM 938,400 938,400 938,400 938,400 938,400 938,400 938,400 938,400 938,400 938,400 938,400
Disposals:
Coop RM 0 0 0 0 0 0 0 0 0 0 0
Land RM 0 0 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0 0 0

Closing balance RM 938,400 938,400 938,400 938,400 938,400 938,400 938,400 938,400 938,400 938,400 938,400

FIXED ASSETS DEPRECIATION

At Cost
Coop RM 788,400 788,400 788,400 788,400 788,400 788,400 788,400 788,400 788,400 788,400 788,400
Land RM 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000
RM 788,400 788,400 788,400 788,400 788,400 788,400 788,400 788,400 788,400 788,400 788,400
Less: Accumulated Depreciation
Coop 20% RM 0 (157,680) (315,360) (473,040) (630,720) (788,400) (788,400) (788,400) (788,400) (788,400) (788,400)
Land 0% RM 0 0 0 0 0 0 0 0 0 0 0
RM 0 (157,680) (315,360) (473,040) (630,720) (788,400) (788,400) (788,400) (788,400) (788,400) (788,400)
Net Book Value
Coop RM 788,400 630,720 473,040 315,360 157,680 0 0 0 0 0 0
Land RM 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000
RM 938,400 780,720 623,040 465,360 307,680 150,000 150,000 150,000 150,000 150,000 150,000

Depreciation
Coop 0 157,680 157,680 157,680 157,680 157,680 0 0 0 0 0
Land 0 0 0 0 0 0 0 0 0 0 0
Total 0 157,680 157,680 157,680 157,680 157,680 0 0 0 0 0

16
SOURCES & USES OF FUNDS

Year
0
2008

RM

USES OF FUNDS

Pre- Operating expenses (during construction) 152,442

Tax on EBITDA (Operating profits) (39,635)
Tax savings on interest 0
Minimum cash requirement (MCR) (100,000)
Total pre-operating expenses (Pre-ops) 12,807
Working capital (371,045)
(358,238)
Capex - Coop (788,400)
(1,146,638)
Capex - Land (150,000)
Uses before IDC & WTDC (1,296,638)
Debt service - Interest during constuction (IDC) 0
Witholding taxes during construction (WTDC) 0

TOTAL USES OF FUNDS (1,296,638)

SOURCES OF FUNDS
Total Equity 5% 61,402
Grant - Project cost 95% 1,235,236
Debt - Interest during construction (IDC) 0% 0
Total Debt 95% 1,235,236

TOTAL SOURCES OF FUNDS 100% 1,296,638

17
INVESTMENT COST CALCULATION FOR A CHICKEN COOP

Description UNIT PRICE UNIT TOTAL

[RM] [RM]

1 Building Cost 110,000.00 2 220,000.00

2 Equipment Cost 105,000.00 2 210,000.00
3 Power Generator 115,000.00 2 230,000.00
Fencing , Road and Drainage 30,000
Worker's Quarters and Store 30,000
Security Equipement System 10,000
Subtotal (RM) 730,000
6 Contigency 8% 58,400

TOTAL INVESTMENT COST 788,400

18