Top & Rising Company Joint Venture Financial Analysis

Last Modified:

10/2/2016

TOP & RISING JOINT VENTURE

$ (All in SGD'000)
Background Information
PARENT COMPANY
Rising Company
Top Gun Company

Net Worth ($)

$20,000
$50,000

TOP & RISING COMPANY/ JV

Capital Contribution
Rising Company
Top Gun Company

Share Percent
70%
30%

Capital Requirement
Building
Plant & Machinery
Other Fixed Assets

Cost ($)
$8,000
$10,000
$2,000

Capital Structure
Shareholder Equity ($)
Equity ($)
Loan ($)
Total Shareholder Equity
Debt Obligations ($)
STF ($)
Term Loan ($)

$6,000
$14,000

OTHER FIGURES
Tax Rate
Loan Interest Rate
Repayment Period
5th Year Capacity Used

0%
7%
5 years
70%

$3,000
$3,500
$6,500

Sales($)
$50,000
$100,000

Useful Life
50 years
10 years
5 years

After-tax Profit ($)

$3,000
$7,000

Location
Singapore
Japan

Main Business
Manufacturing Plastic Containers
Edible oil and fat processing

Year
P&L (SGD'000, Year Ending)
Sales

0
Dec-X4

1
Dec-X5

2
Dec-X6

3
Dec-X7

4
Dec-X8

5
Dec-X9

6
Dec-X10

7
Dec-X11

8
Dec-X12

9
Dec-X13

$15,000

$17,500

$20,000

$25,000

$30,000

$32,571

$35,143

$37,714

$40,286

$42,857

Less: COGS

($10,500)

($12,250)

($14,000)

($17,500)

($21,000)

($22,800)

($24,600)

($26,400)

($28,200)

($30,000)

Gross Profit

$4,500

$5,250

$6,000

$7,500

$9,000

$9,771

$10,543

$11,314

$12,086

$12,857

Less: SG&A

($1,500)

($1,750)

($2,000)

($2,500)

($3,000)

($3,257)

($3,514)

($3,771)

($4,029)

($4,286)

EBITDA

$3,000

$3,500

$4,000

$5,000

$6,000

$6,514

$7,029

$7,543

$8,057

$8,571

Less: D&A

($1,560)

($1,560)

($1,560)

($1,560)

($1,560)

($1,560)

($1,560)

($1,560)

($1,560)

($1,560)

EBIT

$1,440

$1,940

$2,440

$3,440

$4,440

$4,954

$5,469

$5,983

$6,497

$7,011

Less: Interest expenses - STF

($368)

($58)

($48)

($96)

($96)

($50)

($49)

($50)

($50)

Less: Interest expenses - TL

($490.00)

($980.00)

($784.00)

($588.00)

($392.00)

($196.00)

EBT

($490.00)

$92

$1,098

$1,804

$2,952

$4,148

$4,905

$5,419

$5,933

$6,448

$6,962

($490.00)

$92

$1,098

$1,804

$2,952

$4,148

$4,905

$5,419

$5,933

$6,448

$6,962

Less: Taxes
Net Profit

10
Dec-X14

($50)

Year
NWC Requirement (SGD'000, Year Ending)
Projected Stocks

0
Dec-X4

2 months raw material

1
Dec-X5
$3,000

2
Dec-X6
$3,500

3
Dec-X7
$4,000

4
Dec-X8
$5,000

5
Dec-X9
$6,000

6
Dec-X10
$6,514

7
Dec-X11
$7,029

8
Dec-X12
$7,543

9
Dec-X13
$8,057

10
Dec-X14
$8,571

$1,000

$1,167

$1,333

$1,667

$2,000

$2,171

$2,343

$2,514

$2,686

$2,857

$688

$802

$917

$1,146

$1,375

$1,493

$1,611

$1,729

$1,846

$1,964

1.5 months finished goods

$1,313

$1,531

$1,750

$2,188

$2,625

$2,850

$3,075

$3,300

$3,525

$3,750

Add: Projected Debtors - 2months

$2,500

$2,917

$3,333

$4,167

$5,000

$5,429

$5,857

$6,286

$6,714

$7,143

($1,000)

($1,167)

($1,333)

($1,667)

($2,000)

($2,171)

($2,343)

($2,514)

($2,686)

($2,857)

1 month WIP

Less: Projected creditors - 2 months

Less: Projected accurals - 1 months

($375)

($438)

($500)

($625)

($750)

($814)

($879)

($943)

($1,007)

($1,071)

NWC Requirement

$4,125

$4,813

$5,500

$6,875

$8,250

$8,957

$9,664

$10,371

$11,079

$11,786

Incremental NWC

$4,125

$688

$688

$1,375

$1,375

$707

$707

$707

$707

$707

STF

$5,263

$830

$688

$1,375

$1,375

$707

$707

$707

$707

$707

STF drawdown each year = change in incremental NWC

Year
Debt (SGD'000, Year Ending)
Term Loan

0
Dec-X4

1
Dec-X5

2
Dec-X6

3
Dec-X7

4
Dec-X8

5
Dec-X9

6
Dec-X10

7
Dec-X11

8
Dec-X12

9
Dec-X13

10
Dec-X14

$14,000

$14,000

$11,200

$8,400

$5,600

$2,800

(2,800)

(2,800)

(2,800)

(2,800)

(2,800)

Ending Balance

$14,000

$11,200

$8,400

$5,600

$2,800

Interest Expense

($490.00)

($980.00)

($784.00)

($588.00)

($392.00)

($196.00)

$5,263

$830

$688

$1,375

$1,375

$707

$707

$707

$707

$707

(5,263)

(830)

(688)

(1,375)

(1,375)

(707)

(707)

(707)

(707)

(707)

Ending Balance

Interest Expense

($368.44)

($58.07)

($48.13)

($96.25)

($96.25)

($49.50)

($49.50)

($49.50)

($49.50)

($49.50)

Beginning Balance
Less: Repayment

Short-term Bank Facilities

Beginning Balance
Less: Repayment

Year
Cash Flow (SGD'000, Year Ending)
Net Profit After Tax

0
Dec-X4
($490.00)

1
Dec-X5
$92

2
Dec-X6
$1,098

3
Dec-X7
$1,804

4
Dec-X8
$2,952

5
Dec-X9
$4,148

6
Dec-X10
$4,905

7
Dec-X11
$5,419

8
Dec-X12
$5,933

9
Dec-X13
$6,448

10
Dec-X14
$6,962

Add: Depreciation

$1,560

$1,560

$1,560

$1,560

$1,560

$1,560

$1,560

$1,560

$1,560

$1,560

Less: Changes in NWC

($4,125)

($688)

($688)

($1,375)

($1,375)

($707)

($707)

($707)

($707)

($707)

$20,500

$5,263

$830

$688

$1,375

$1,375

$707

$707

$707

$707

$707

Capital

$3,000

Shareholders' Loan

$3,500

Bank Term Loan

$14,000

STF Drawdown

$5,263

$830

$688

$1,375

$1,375

$707

$707

$707

$707

$707

($20,000)

($2,800)

($2,800)

($2,800)

($2,800)

($2,800)

($2,000)

($20,000)

($2,000)

($2,800)

($2,800)

($2,800)

($2,800)

($2,800)

Net Cash Flow

10

(10)

(0)

564

1,712

2,908

4,465

6,979

7,493

8,008

8,522

Opening Cash Balance

Clsoing Cash Balance

$0
$10

$10
$0

$0
$0

$0
$564

$564
$2,276

$2,276
$5,183

$5,183
$9,648

$9,648
$16,627

$16,627
$24,121

$24,121
$32,128

$32,128
$40,650

Add: Non P&L Cash Inflows

Less: Non P&L Cash Outflows

Capital Expenditure
Term Loan Principal Repay

Year
Cash Flow (SGD'000, Year Ending)
Fixed Assets
Stocks

0
Dec-X4
$20,000

1
Dec-X5
$18,440

2
Dec-X6
$16,880

3
Dec-X7
$15,320

4
Dec-X8
$13,760

5
Dec-X9
$12,200

6
Dec-X10
$12,640

7
Dec-X11
$11,080

$3,000

$3,500

$4,000

$5,000

$6,000

$6,514

$2,500

$2,917

$3,333

$4,167

$5,000

$5,429

$5,857

$6,286

$6,714

$7,143

$0

$0

$564

$2,276

$5,183

$9,648

$16,627

$24,121

$32,128

$40,650

$20,010

$23,940

$23,297

$23,217

$25,202

$28,383

$34,231

$40,593

$47,469

$54,860

$62,764

Share Capital

$3,000

$3,000

$3,000

$3,000

$3,000

$3,000

$3,000

$3,000

$3,000

$3,000

$3,000

Shareholders' Loan

$3,500

$3,500

$3,500

$3,500

$3,500

$3,500

$3,500

$3,500

$3,500

$3,500

$3,500

Retained Earnings

($490)

($398)

$699

$2,503

$5,455

$9,603

$14,508

$19,927

$25,860

$32,308

$39,270

$14,000

$11,200

$8,400

$5,600

$2,800

$5,263

$6,093

$6,781

$8,156

$9,531

$10,238

$10,945

$11,652

$12,359

$13,066

Total Assets

$8,057

10
Dec-X14
$6,400

Cash

$7,543

9
Dec-X13
$7,960

$10

Debtors

$7,029

8
Dec-X12
$9,520

$8,571

Funded By:

Long Term Loan

Short Term Facilities
Trade Creditiors
Accurals
Total Shareholders' Equity and Liabilities
Checking

$1,000

$1,167

$1,333

$1,667

$2,000

$2,171

$2,343

$2,514

$2,686

$2,857

$20,010

$375
$23,940

$438
$23,297

$500
$23,217

$625
$25,202

$750
$28,383

$814
$34,231

$879
$40,593

$943
$47,469

$1,007
$54,860

$1,071
$62,764