Cosmetic Product Producing Plant

7/28/2019 Cosmetic Product Producing Plant

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Investment Office ANRS

Project Profile on the Establishment

of Cosmetic product Producingplant


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Tables of Contents

1.Executive Summary.....................................................................................................................................1

2.Product Description and Application........................................................................................................1

3.Market Study, Plant Capacity and Production Program........................................................................2

3.1Market Study...........................................................................................................................................2

3.1.1Present Demand and Supply...........................................................................................................2

3.1.2Projected Demand..........................................................................................................................2

3.1.3Pricing and Distribution.................................................................................................................3

3.2Plant Capacity.........................................................................................................................................3

3.3Production Program................................................................................................................................4

4.Raw Materials and Utilities........................................................................................................................44.1Availability and Source of Raw materials..............................................................................................4

4.2Annual Requirement and Cost of Raw Materials and Utilities...............................................................4

5.Location and Site.........................................................................................................................................5

6.Technology and Engineering .....................................................................................................................5

6.1.Production Process.................................................................................................................................5

6.2.Machinery and Equipment.....................................................................................................................5

6.3.Civil Engineering Cost...........................................................................................................................6

7.Human Resource and Training Requirement...........................................................................................7

7.1.Human Resource ...................................................................................................................................7

7.2.Training Requirement............................................................................................................................8


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1. Executive Summary

This project profile deals with the establishment of cosmetic product producing plant in Amhara

National Regional State. The following presents the main findings of the study

Demand projection divulges that the domestic demand for this product is substantial and is

increasing with time. Accordingly, the planned plant is set to produce 30,000 bottles of vanishing

cream, 120,000 Kg of Soap and 500kg of face powder annually. The total investment cost of the

project including working capital is estimated at Birr 16.75 million and creates 61 jobs and Birr

573,120 household income.

The financial result indicates that the project generates profit beginning from the second year of

operation. Moreover, the project breaks even at 30.7% of capacity utilization and it payback fully

the initial investment less working capital in fourth year of its operation. The results further show

that the calculated IRR of the project is 20.9%.

In addition to this, the proposed project possesses wide range of economic and social benefits

such as increasing the level of investment, tax revenue, employment creation and import

substitution.


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cream, hair fixer, after shave. Cosmetics for teeth include tooth powder and tooth paste.

Different cosmetics require different ingredients and different preparation formulas.

3. Market Study, Plant Capacity and Production Program

3.1Market Study

3.1.1 Present Demand and Supply

The Amhara Region is home to about 19.2 million people. In countries where the standard of

living is high, 19.2 million people could have supported a multi-million dodder cosmetics

industry. However, since the standard of living of the people in the Amhara Region is very low

the market for cosmetics is limited to few brands like Vaseline, vanishing cream, cold cream,

hair oils. These cosmetics products are widely used in the urban areas and to some extent in

rural areas. Other cosmetics products such as tooth paste, nail polish, after shave, shaving cream,

etc. are used by people of higher income in the urban areas of the Region. Women are the main

consumers of many types of cosmetics products. Potential customers of cosmetics products in

the Amhara Region are girls and women above age of 5. The number of female in this age group

in the Region is about 8 million of whom 11.5 percent or 921,000 live in urban areas. If we

assume that at least 70 percent of the urban potential customers and 40 percent of the rural


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Table 1: Projected Demand for Cosmetic Products

YearProjected Demand

for Cosmetics

(in tons)2007/08 1,400

2008/09 1449

2009/10 1500

2010/11 1552

2011/12 1607

2012/13 1663

2013/14 1721

2014/15 1781

2015/16 1844

2016/17 1908

2017/18 19752018/19 2044


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3.3Production Program

The program is scheduled based on the consideration that the envisaged plant will work 275 daysin a year in 2 shifts, where the remaining days will be holidays and for maintenance. During the

first year of operation the plant will operate at 75 percent capacity and then it grows to 85

percent in the 2nd year. The capacity will grow to 100 percent starting from the 3rd year. This

consideration is developed based on the assumption that market and logistics barriers would take

place for the first two years of operation.

4. Raw Materials and Utilities

4.1 Availability and Source of Raw materials

Different cosmetics use different types of inputs with varying proportions. Basically there are

about six types of inputs which constitute the components of many types of cosmetics. These are

waxes, fatty acids, vitamin zed oil, lecithin bentonite and petroleum jelly or Vaseline.

Depending on the type of cosmetics to be made, other inputs are also added to the basic

ingredients. Some of the main inputs such as wax, fatty acids can be obtained from domestic

sources; others have to be imported.

4.2 Annual Requirement and Cost of Raw Materials and

Utilities


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Vitamin zed oil 22000 0 1,140

Lecithin bentonite 27500 0 1,482

Petroleum jelly 30250 0 1,254

Total Material Cost 1,254 3,876

Utility 6

Electricity 26.4

Furnace Oil 24

Water 5.3

Total Utility Cost 40,1

5. Location and Site

The appropriate locations for the envisaged project in view of the availability of input,

infrastructures as well as market for the output are Combolcha and Bahir Dar.

6. Technology and Engineering

6.1. Production Process

The formulation and production processes of different groups of cosmetics are different. Hence,

since there is no one common process for all cosmetics, no process description is given in this

section.

6 2 Machinery and Equipment


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toothpaste per year, total investment will be: 1.5 million. However this plant is only planned to

produce three main products i.e. Soap, Vanishing Cream and Face powder.

The machineries and equipment required for producing the stated product is detailed in Table 3

below.

Table 3: Machinery and Equipments

The, total cost of machinery and equipment including freight insurance and bank cost is

estimated to be about Birr 1.05 million.

Machinery and Equipment Quantity

Heating equipments 5

Equipment for creams 5

Equipment for liquids 4

Total 14


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The total site area for the envisaged plant is estimated to be 3,000m2 where 1200m2 is allocated

to the production place and the remaining space is left for stores (900m 2), office buildings and

facilities (500m2).The land lease cost is estimated at Birr 180,000. The civil engineering and

building costs is estimated at Birr 2.4 million.

7. Human Resource and Training Requirement

7.1. Human Resource

The list of required manpower for the envisaged plant is stated in Table 4 below

Table 4: Human Resource Requirements

Position No. Required

MonthlySalary/Wag

e

(in Birr)

TotalAnnual

Salary

(in Birr)

General Manager 1 3500 42,000

Mechanical Engineer 1 2500 30,000

Administration 1 2000 24,000

Accountant 2 1200 28,800

Secretary 3 850 30,600

Sales Clerk 5 700 42,000


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The envisaged plant therefore, creates 61 jobs and about Birr 573120 of household income. The

professionals and support staffs for the envisaged plant shall be recruited from Amhara region

7.2. Training Requirement

Training of key personnel shall be conducted. This can be arranged with the suppliers of the

plant machineries. The training should primarily focuses on the production technology and

machinery maintenance and trouble shooting. Birr 90,000 is allocated as training expense in the

working capital.

8. Financial Analysis

8.1. Underlying Assumption

The financial analysis of Cosmetics producing plant is based on the data provided in the

preceding chapters and the following assumptions.

A. Construction and Finance

Construction period 2 year

Source of finance 40% equity and 60% loan


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Pre-production (amortization) 20%


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C. Working Capital (Minimum Days of Coverage)

Raw Material-Local 30

Raw Material-Foreign 120

Factory Supplies in Stock 30

Spare Parts in Stock and Maintenance 30

Work in Progress 10

Finished Products 15

Accounts Receivable 30

Cash in Hand 30

Accounts Payable 30

8.2. Investment

The total investment cost of the project including working capital is estimated at Birr 16.75

million as shown in Table 5 below. The Owner shall contribute 40% of the finance in the form of

equity while the remaining 60% is to be financed by bank loan.


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Table 5: Total Initial Investments

Total Initial Investment

Item Cost

Land 9,000.00

Building and civil works 2,400,000.00

Office equipment 100,000.00

Vehicles 500,000.00

Plant machinery & equipment 10,500,000.00

Total Fixed Investment 13,509,000.00

Pre production capital expenditure 675,450.00

Total Initial Investment 14,184,450.00

Working capital at full capacity2,566,343.00

Total 16,750,793.00

*Pre-production capital expenditure includes - all expenses for pre-

investment studies, consultancy fee during construction andexpenses for companys establishment, project administration

expenses, commission expenses, preproduction marketing and

interest expenses during construction.

The foreign component of the project accounts for Birr 19.1 million or 72% of the total

investment cost.


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Table 6: Production Cost

Total Production Cost at Full Capacity

Items Cost

1. Raw materials 5,130,000.00

2. Utilities 40,100.00

3. Wages and Salaries 573,120.00

4. Spares and Maintenance 405,270.00

Factory costs 6,148,490.00

5. Depreciation 1,415,090.00

6. Financial costs1,206,057.10

Total Production Cost

8,769,637.10

8.4. Financial evaluation

I. Profitability

According to the projected income statement attached in the annex part the project will generate

profit beginning from the Second year of operation. Ratios such as the percentage of net profit to

l l i d l i 0 3 % 16 33% d 0 4 % i h


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III. Payback Period

Investment cost and income statement projection are used in estimating the project payback

period. The projects will payback fully the initial investment less working capital in second year.

IV. Simple Rate of Return

For the envisaged plant the simple rate of return equals to 17.9%.

V. Internal Rate of Return and Net Present Value

Based on cash flow statement described in the annex part, the calculated IRR of the project is

20.9% and the net present value at 18 % discount is Birr 1.67 million.

VI. Sensitivity Analysis

The envisaged plant is profitable even with considerable cost increment. That is the plant

maintains to be profitable starting from the first year when 10 % cost increment takes place in

the sector. This result is accompanied by IRR value of 21.55 % with payback period of third

year.

9 Economic and Social Benefit and Justification


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B. Tax Revenue

In the project life under consideration, the region will collect about Birr 7.77 million from

corporate tax payment alone (i.e. excluding income tax, sales tax and VAT). Such result create

additional fund for the regional government that will be used in expanding social and other basic

services in the region

C. Import Substitution and Foreign Exchange Saving

Based on the projected figure we learn that in the project life an estimated amount of US Dollar

10.9 million will be saved as a result of the proposed project. This will create a room for the

saved hard currency to be allocated on other vital and strategic sectors

D. Employment and Income Generation

The proposed project is expected to create employment opportunity to several citizens of the

region. That is, it will provide permanent employment to 61 professionals as well as support

stuffs. Consequently the project creates income of Birr 573,120 per year. This would be one of

the commendable accomplishments of the project.


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ANNEXES


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Annex 1: Total Net Working Capital Requirements (in Birr)

CONSTRUCTION PRODUCTION

Year 1 Year 2 1 2 3 4

Capacity Utilization (%) 0 0 75% 85% 100% 100%

1. Total Inventory 0 0 3,245,694 3,678,453 4,327,592 4,327,592

Raw Materials in Stock- Total 0 0 1,371,109 1,553,924 1,828,145 1,828,145

Raw Material-Local 0 0 102,600 116,280 136,800 136,800

Raw Material-Foreign 0 0 1,268,509 1,437,644 1,691,345 1,691,345

Factory Supplies in Stock 0 0 6,188 7,014 8,251 8,251

Spare Parts in Stock and Maintenance 0 0 33,158 37,580 44,211 44,211

Work in Progress 0 0 154,710 175,338 206,279 206,279

Finished Products 0 0 309,419 350,675 412,559 412,559

2. Accounts Receivable 0 0 932,727 1,057,091 1,243,636 1,243,636

3. Cash in Hand 0 0 50,173 56,862 66,897 66,897

CURRENT ASSETS 0 0 2,857,485 3,238,482 3,809,979 3,809,979

4. Current Liabilities 0 0 932,727 1,057,091 1,243,636 1,243,636

Accounts Payable 0 0 932,727 1,057,091 1,243,636 1,243,636

TOTAL NET WORKING CAPITAL REQUIREMENTS 0 0 1,924,757 2,181,392 2,566,343 2,566,343

INCREASE IN NET WORKING CAPITAL 0 0 1,924,757 256,634 384,951 0

1


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Annex 1: Total Net Working Capital Requirements (in Birr) (continued)

PRODUCTION

5 6 7 8 9 10

Capacity Utilization (%) 100% 100% 100% 100% 100% 100%

1. Total Inventory 4,327,592 4,327,592 4,327,592 4,327,592 4,327,592 4,327,592

Raw Materials in Stock-Total 1,828,145 1,828,145 1,828,145 1,828,145 1,828,145 1,828,145

Raw Material-Local 136,800 136,800 136,800 136,800 136,800 136,800

Raw Material-Foreign 1,691,345 1,691,345 1,691,345 1,691,345 1,691,345 1,691,345

Factory Supplies in Stock 8,251 8,251 8,251 8,251 8,251 8,251

Spare Parts in Stock and Maintenance 44,211 44,211 44,211 44,211 44,211 44,211

Work in Progress 206,279 206,279 206,279 206,279 206,279 206,279

Finished Products 412,559 412,559 412,559 412,559 412,559 412,559

2. Accounts Receivable 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636

3. Cash in Hand 66,897 66,897 66,897 66,897 66,897 66,897

CURRENT ASSETS 3,809,979 3,809,979 3,809,979 3,809,979 3,809,979 3,809,979

4. Current Liabilities 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636

Accounts Payable 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636

TOTAL NET WORKING CAPITAL REQUIREMENTS 2,566,343 2,566,343 2,566,343 2,566,343 2,566,343 2,566,343

INCREASE IN NET WORKING CAPITAL 0 0 0 0 0 0

2


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Annex 2: Cash Flow Statement (in Birr)


Year 1 Year 2 1 2 3 4

TOTAL CASH INFLOW 7,092,225 9,658,568 9,482,727 9,814,364 11,586,545 11,400,000

1. Inflow Funds 7,092,225 9,658,568 932,727 124,364 186,545 0

Total Equity 2,836,890 3,863,427 0 0 0 0

Total Long Term Loan 4,255,335 5,795,141 0 0 0 0

Total Short Term Finances 0 0 932,727 124,364 186,545 0

2. Inflow Operation 0 0 8,550,000 9,690,000 11,400,000 11,400,000

Sales Revenue 0 0 8,550,000 9,690,000 11,400,000 11,400,000

Interest on Securities 0 0 0 0 0 03. Other Income 0 0 0 0 0 0

TOTAL CASH OUTFLOW 7,092,225 7,092,225 10,023,818 8,347,527 10,116,337 9,404,134

4. Increase In Fixed Assets 7,092,225 7,092,225 0 0 0 0

Fixed Investments 6,754,500 6,754,500 0 0 0 0

Pre-production Expenditures 337,725 337,725 0 0 0 0

5. Increase in Current Assets 0 0 2,857,485 380,998 571,497 0

6. Operating Costs 0 0 4,503,507 5,085,392 5,958,221 5,958,221

7. Corporate Tax Paid 0 0 0 0 906,492 966,795

8. Interest Paid 0 0 2,662,827 1,206,057 1,005,048 804,038

9. Loan Repayments 0 0 0 1,675,079 1,675,079 1,675,079

10. Dividends Paid 0 0 0 0 0 0

Surplus (Deficit) 0 2,566,343 -541,091 1,466,837 1,470,208 1,995,866

Cumulative Cash Balance 0 2,566,343 2,025,252 3,492,089 4,962,297 6,958,164

3


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Annex 2: Cash Flow Statement (in Birr): Continued

PRODUCTION

5 6 7 8 9 10TOTAL CASH INFLOW 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000

1. Inflow Funds 0 0 0 0 0 0

Total Equity 0 0 0 0 0 0

Total Long Term Loan 0 0 0 0 0 0

Total Short Term Finances 0 0 0 0 0 0

2. Inflow Operation 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000

Sales Revenue 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000

Interest on Securities 0 0 0 0 0 0

3. Other Income 0 0 0 0 0 0


4. Increase In Fixed Assets 0 0 0 0 0 0

Fixed Investments 0 0 0 0 0 0

Pre-production Expenditures 0 0 0 0 0 0

5. Increase in Current Assets 0 0 0 0 0 0

6. Operating Costs 5,958,221 5,958,221 5,958,221 5,958,221 5,958,221 5,958,221

7. Corporate Tax Paid 1,027,098 1,157,928 1,218,231 1,278,534 1,278,534 1,278,534

8. Interest Paid 603,029 402,019 201,010 0 0 09. Loan Repayments 1,675,079 1,675,079 1,675,079 0 0 0

10. Dividends Paid 0 0 0 0 0 0

Surplus (Deficit) 2,136,573 2,206,753 2,347,459 4,163,245 4,163,245 4,163,245

Cumulative Cash Balance 9,094,737 11,301,490 13,648,949 17,812,194 21,975,440 26,138,685

4


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Annex 3: DISCOUNTED CASH FLOW-TOTAL CAPITAL INVESTED


Year 1 Year 2 1 2 3 4

TOTAL CASH INFLOW 0 0 8,550,000 9,690,000 11,400,000 11,400,000

1. Inflow Operation 0 0 8,550,000 9,690,000 11,400,000 11,400,000

Sales Revenue 0 0 8,550,000 9,690,000 11,400,000 11,400,000




3. Increase in Fixed Assets 7,092,225 7,092,225 0 0 0 0

Fixed Investments 6,754,500 6,754,500 0 0 0 0

Pre-production Expenditures 337,725 337,725 0 0 0 0

4. Increase in Net Working Capital 0 0 1,924,757 256,634 384,951 0

5. Operating Costs 0 0 4,503,507 5,085,392 5,958,221 5,958,221

6. Corporate Tax Paid 0 0 0 0 906,492 966,795

NET CASH FLOW -7,092,225 -7,092,225 2,121,736 4,347,973 4,150,335 4,474,984

CUMULATIVE NET CASH FLOW -7,092,225 -14,184,450 -12,062,714 -7,714,741 -3,564,406 910,578

Net Present Value (at 18%) -7,092,225 -6,010,360 1,523,798 2,646,311 2,140,697 1,956,057

Cumulative Net present Value -7,092,225 -13,102,585 -11,578,787 -8,932,477 -6,791,780 -4,835,723

5


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Annex 3: DISCOUNTED CASH FLOW-TOTAL CAPITAL INVESTED (Continued)

PRODUCTION

5 6 7 8 9 10

TOTAL CASH INFLOW 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000

1. Inflow Operation 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000

Sales Revenue 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000




3. Increase in Fixed Assets 0 0 0 0 0 0

Fixed Investments 0 0 0 0 0 0

Pre-production Expenditures 0 0 0 0 0 0

4. Increase in Net Working Capital 0 0 0 0 0 0

5. Operating Costs 5,958,221 5,958,221 5,958,221 5,958,221 5,958,221 5,958,221

6. Corporate Tax Paid 1,027,098 1,157,928 1,218,231 1,278,534 1,278,534 1,278,534

NET CASH FLOW 4,414,681 4,283,851 4,223,548 4,163,245 4,163,245 4,163,245

CUMULATIVE NET CASH FLOW 5,325,259 9,609,110 13,832,659 17,995,904 22,159,150 26,322,395

Net Present Value (at 18%) 1,635,337 1,344,808 1,123,625 938,629 795,448 674,109

Cumulative Net present Value -3,200,386 -1,855,578 -731,953 206,676 1,002,124 1,676,233

Net Present Value (at 18%) 1,676,232.89

Internal Rate of Return 20.9%

6


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Annex 4: NET INCOME STATEMENT ( in Birr)

PRODUCTION

1 2 3 4 5

Capacity Utilization (%) 75% 85% 100% 100% 100%

1. Total Income 8,550,000 9,690,000 11,400,000 11,400,000 11,400,000

Sales Revenue 8,550,000 9,690,000 11,400,000 11,400,000 11,400,000

Other Income 0 0 0 0 0

2. Less Variable Cost 4,192,206 4,751,167 5,589,608 5,589,608 5,589,608

VARIABLE MARGIN 4,357,794 4,938,833 5,810,392 5,810,392 5,810,392

(In % of Total Income) 50.97 50.97 50.97 50.97 50.97

3. Less Fixed Costs 1,726,391 1,749,316 1,783,703 1,783,703 1,783,703

OPERATIONAL MARGIN 2,631,403 3,189,518 4,026,689 4,026,689 4,026,689


4. Less Cost of Finance 2,662,827.11 1,206,057.10 1,005,047.58 804,038.06 603,028.55

5. GROSS PROFIT -31,423.96 1,983,460.47 3,021,641.62 3,222,651.14 3,423,660.65

6. Income (Corporate) Tax 0.00 0.00 906,492.49 966,795.34 1,027,098.20

7. NET PROFIT -31,423.96 1,983,460.47 2,115,149.13 2,255,855.80 2,396,562.46

RATIOS (%)

Gross Profit/Sales -0.37% 20.47% 26.51% 28.27% 30.03%

Net Profit After Tax/Sales -0.37% 20.47% 18.55% 19.79% 21.02%

Return on Investment 16.33% 19.49% 18.63% 18.27% 17.91%

Return on Equity -0.47% 29.60% 31.57% 33.67% 35.77%

7


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Annex 4: NET INCOME STATEMENT (in Birr): Continued

PRODUCTION

6 7 8 9 10

Capacity Utilization (%) 100% 100% 100% 100% 100%

1. Total Income 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000

Sales Revenue 11,400,000 11,400,000 11,400,000 11,400,000 11,400,000

Other Income 0 0 0 0 0

2. Less Variable Cost 5,589,608 5,589,608 5,589,608 5,589,608 5,589,608

VARIABLE MARGIN 5,810,392 5,810,392 5,810,392 5,810,392 5,810,392


3. Less Fixed Costs 1,548,613 1,548,613 1,548,613 1,548,613 1,548,613

OPERATIONAL MARGIN 4,261,779 4,261,779 4,261,779 4,261,779 4,261,779


4. Less Cost of Finance 402,019 201,010 0 0 0

5. GROSS PROFIT 3,859,760 4,060,770 4,261,779 4,261,779 4,261,779

6. Income (Corporate) Tax 1,157,928 1,218,231 1,278,534 1,278,534 1,278,534

7. NET PROFIT 2,701,832 2,842,539 2,983,245 2,983,245 2,983,245

RATIOS (%)Gross Profit/Sales 33.86% 35.62% 37.38% 37.38% 37.38%

Net Profit After Tax/Sales 23.70% 24.93% 26.17% 26.17% 26.17%

Return on Investment 18.53% 18.17% 17.81% 17.81% 17.81%

Return on Equity 40.32% 42.42% 44.52% 44.52% 44.52%

8


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Annex 5: Projected Balance Sheet (in Birr)


Year 1 Year 2 1 2 3 4

TOTAL ASSETS 7,092,225 16,750,793 17,683,520 18,084,841 18,711,456 19,292,2331. Total Current Assets 0 2,566,343 4,882,736 6,730,571 8,772,276 10,768,143

Inventory on Materials and Supplies 0 0 1,410,456 1,598,517 1,880,608 1,880,608

Work in Progress 0 0 154,710 175,338 206,279 206,279

Finished Products in Stock 0 0 309,419 350,675 412,559 412,559

Accounts Receivable 0 0 932,727 1,057,091 1,243,636 1 ,243,636

Cash in Hand 0 0 50,173 56,862 66,897 66,897

Cash Surplus, Finance Available 0 2,566,343 2,025,252 3,492,089 4,962,297 6,958,164

Securities 0 0 0 0 0 0

2. Total Fixed Assets, Net of Depreciation 7,092,225 14,184,450 12,769,360 11,354,270 9,939,180 8,524,090

Fixed Investment 0 6,754,500 13,509,000 13,509,000 13,509,000 13,509,000

Construction in Progress 6,754,500 6,754,500 0 0 0 0Pre-Production Expenditure 337,725 675,450 675,450 675,450 675,450 675,450

Less Accumulated Depreciation 0 0 1,415,090 2,830,180 4,245,270 5,660,360

3. Accumulated Losses Brought Forward 0 0 0 0 0 0

4. Loss in Current Year 0 0 31,424 0 0 0

TOTAL LIABILITIES 7,092,225 16,750,793 17,683,520 18,084,841 18,711,456 19,292,233

5. Total Current Liabilities 0 0 932,727 1,057,091 1,243,636 1 ,243,636

Accounts Payable 0 0 932,727 1,057,091 1,243,636 1 ,243,636

Bank Overdraft 0 0 0 0 0 0

6. Total Long-term Debt 4,255,335 10,050,476 10,050,476 8,375,396 6,700,317 5,025,238

Loan A 4,255,335 10,050,476 10,050,476 8,375,396 6,700,317 5,025,238

Loan B 0 0 0 0 0 0

7. Total Equity Capital 2,836,890 6,700,317 6,700,317 6,700,317 6,700,317 6,700,317Ordinary Capital 2,836,890 6,700,317 6,700,317 6,700,317 6,700,317 6,700,317

Preference Capital 0 0 0 0 0 0

Subsidies 0 0 0 0 0 0

8. Reserves, Retained Profits Brought Forward 0 0 0 -31,424 1,952,037 4,067,186

9.Net Profit After Tax 0 0 0 1,983,460 2,115,149 2,255,856

Dividends Payable 0 0 0 0 0 0

Retained Profits 0 0 0 1,983,460 2,115,149 2,255,856

9


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Annex 5: Projected Balance Sheet (in Birr): Continued

PRODUCTION

5 6 7 8 9 10

TOTAL ASSETS 20,013,716 21,040,469 22,207,928 25,191,174 28,174,419 31,157,665

1. Total Current Assets 12,904,716 15,111,469 17,458,928 21,622,174 25,785,419 29,948,665Inventory on Materials and Supplies 1,880,608 1,880,608 1,880,608 1,880,608 1,880,608 1,880,608

Work in Progress 206,279 206,279 206,279 206,279 206,279 206,279

Finished Products in Stock 412,559 412,559 412,559 412,559 412,559 412,559

Accounts Receivable 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636

Cash in Hand 66,897 66,897 66,897 66,897 66,897 66,897

Cash Surplus, Finance Available 9,094,737 11,301,490 13,648,949 17,812,194 21,975,440 26,138,685

Securities 0 0 0 0 0 0

2. Total Fixed Assets, Net of Depreciation 7,109,000 5,929,000 4,749,000 3,569,000 2,389,000 1,209,000

Fixed Investment 13,509,000 13,509,000 13,509,000 13,509,000 13,509,000 13,509,000

Construction in Progress 0 0 0 0 0 0

Pre-Production Expenditure 675,450 675,450 675,450 675,450 675,450 675,450

Less Accumulated Depreciation 7,075,450 8,255,450 9,435,450 10,615,450 11,795,450 12,975,4503. Accumulated Losses Brought Forward 0 0 0 0 0 0

4. Loss in Current Year 0 0 0 0 0 0

TOTAL LIABILITIES 20,013,716 21,040,469 22,207,928 25,191,174 28,174,419 31,157,665

5. Total Current Liabilities 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636

Accounts Payable 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636 1,243,636

Bank Overdraft 0 0 0 0 0 0

6. Total Long-term Debt 3,350,159 1,675,079 0 0 0 0

Loan A 3,350,159 1,675,079 0 0 0 0

Loan B 0 0 0 0 0 0

7. Total Equity Capital 6,700,317 6,700,317 6,700,317 6,700,317 6,700,317 6,700,317

Ordinary Capital 6,700,317 6,700,317 6,700,317 6,700,317 6,700,317 6,700,317Preference Capital 0 0 0 0 0 0

Subsidies 0 0 0 0 0 0

8. Reserves, Retained Profits Brought Forward 6,323,041 8,719,604 11,421,436 14,263,975 17,247,220 20,230,466

9. Net Profit After Tax 2,396,562 2,701,832 2,842,539 2,983,245 2,983,245 2,983,245

Dividends Payable 0 0 0 0 0 0

Retained Profits 2,396,562 2,701,832 2,842,539 2,983,245 2,983,245 2,983,245

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Cosmetic Product Producing Plant

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