Income Statement Assumptions Year 1 Year 2 Year 3 Year 4 Year 5

Revenue 40,000 75,000 100,000 200,000 300,000

Gross margin % 55.0% 55.0% 55.0% 55.0% 55.0%
Cost of sales 18,000 33,750 45,000 90,000 135,000
Gross margin 22,000 41,250 55,000 110,000 165,000
Research and development 5,000 6,000 8,000 17,000 25,000
Sales and marketing 6,000 7,000 8,000 16,000 24,000
General and administrative 5,000 6,000 9,000 17,000 26,000
Operating expenses 16,000 19,000 25,000 50,000 75,000
Depreciation 20.0% 5,000 14,000 11,600 9,680 11,744
Operating income 1,000 8,250 18,400 50,320 78,256
Finance costs 4.0% 600 2,248 1,615 956 487
Income before tax 400 6,002 16,785 49,364 77,769
Income tax expense 20.0% 80 1,200 3,357 9,873 15,554
Net income 320 4,802 13,428 39,491 62,215

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Balance sheet Assumptions Opening Year 1 Year 2 Year 3 Year 4 Year 5

Assets
Cash 5,000 1,846 1,156 4,951 29,451 60,164
Accounts receivable 45 6,000 4,932 9,247 12,329 24,658 36,986
Inventory 90 5,000 4,438 8,322 11,096 22,192 33,288
Current assets 16,000 11,216 18,725 28,376 76,300 130,438
Long-term assets 20,000 20,000 56,000 46,400 38,720 46,976
Total assets 36,000 31,216 74,725 74,776 115,020 177,414

Liabilities
Accounts payable 60 3,500 2,959 5,548 7,397 14,795 22,192
Other liabilities 60 2,500 2,742 3,690 4,927 9,999 14,966
Current liabilities 6,000 5,701 9,238 12,324 24,794 37,157
Long-term debt 3 15,000 10,195 40,365 23,902 12,185 0
Total liabilities 21,000 15,896 49,603 36,226 36,979 37,157

Equity
Capital 10,000 10,000 15,000 15,000 15,000 15,000
Retained earnings 5,000 5,320 10,122 23,550 63,041 125,256
Total equity 15,000 15,320 25,122 38,550 78,041 140,256
Total liabilities and equity 36,000 31,216 74,725 74,776 115,020 177,414

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Cash Flow Statement Assumptions Year 1 Year 2 Year 3 Year 4 Year 5

Net income 320 4,802 13,428 39,491 62,215

Add back depreciation 5,000 14,000 11,600 9,680 11,744
Changes in working capital
Accounts receivable 1,068 -4,315 -3,082 -12,329 -12,329
Inventory 562 -3,884 -2,774 -11,096 -11,096
Accounts payable -541 2,589 1,849 7,397 7,397
Other liabilities 242 948 1,237 5,072 4,966
Cash flows from operating activities 6,651 14,140 22,258 38,216 62,898

Amount paid for long-term assets -5,000 -50,000 -2,000 -2,000 -20,000
Cash flows from investing activities -5,000 -50,000 -2,000 -2,000 -20,000

Proceeds from long-term debt 4 46,000

Proceeds from issue of share capital 0 5,000 0 0 0
Repayment of long-term debt -4,805 -15,830 -16,463 -11,716 -12,185
Cash flow from financing activities -4,805 35,170 -16,463 -11,716 -12,185

Cash flow 0 -3,154 -690 3,795 24,500 30,713

Beginning cash balance 5,000 1,846 1,156 4,951 29,451
Ending cash balance 1,846 1,156 4,951 29,451 60,164

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Ratios Year 1 Year 2 Year 3 Year 4 Year 5

Profitability (Net income / Revenue) 0.8% 6.4% 13.4% 19.7% 20.7%

Efficiency (Revenue / Assets) 1.28 1.00 1.34 1.74 1.69
Leverage (Liabilities / Assets) 50.9% 66.4% 48.4% 32.1% 20.9%
Operating return on assets (ROA) 3.2% 11.0% 24.6% 43.7% 44.1%
Return on equity (ROE) 2.1% 19.1% 34.8% 50.6% 44.4%
Liquidity (Current assets / Current liabilities) 1.97 2.03 2.30 3.08 3.51
Breakeven revenue 39,273 64,087 69,481 110,247 158,603

Graphs

Revenue Net income

350,000 70,000
300,000 60,000
250,000 50,000
200,000 40,000
150,000 30,000
100,000 20,000
50,000 10,000
0 0
1 2 3 4 5 1 2 3 4 5

Free cash flow (cumulative) Cash balance

80000 70,000
60,000
60000
50,000
40000
40,000
20000 30,000

0 20,000
0 1 2 3 4 5
10,000
-20000
0
-40000 1 2 3 4 5

© 2018 www.planprojections.com 572750260.xlsx

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