LBO_Model
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ABC Company, Inc. Recapitalization Analysis (figures in U.S. dollars, thousands) Key Inputs & Assumptions Outputs Company Name: ABC Company, Inc. Exit EBITDA Multiple: 5.0x FYE Ended: Company Fiscal Year Ended: 12/31/14 Exit EBITDA Sensitivity 1.0x 2017 2018 2019 Date of Transaction Analysis: 9/25/14 Total Sources/2014E EBI 6.0x Summary of Equity Sponsor Returns Date of Transaction Offer: 12/31/14 Interest Rate (1=Avg., 3 Trailing EBITDA Multiple Pro Forma Year: 2014 Paydown Debt? ("Yes", " No 4.0x 15.4% 17.9% 19.1% 5.0x 25.6% 25.0% 24.4% Sources of Funds Amount Ownership Opt/Warr Diluted %Sources 6.0x 34.4% 31.1% 29.0% New Equity Sponsor 5,000 80.0% --- 70.8% 40.1% Rollover 1,250 20.0% 10.0% 26.5% 10.0% Summary of Mezzanine Holder Returns New Mezzanine w/ Warrants -- --- 3.0% 2.7% --- Trailing EBITDA Multiple 100.0% 13.0% 100.0% 4.0x 17.8% 16.8% 16.3% 5.0x 19.9% 18.4% 17.6% Debt / EBITDA 6.0x 21.9% 20.0% 18.9% Rate 2014E 2015P New Mezzanine w/ Warrants 1,035 10.0% 0.50x 0.43x 8.3% Value of Management Stake New Senior Notes 2,070 9.0% 1.00x 0.87x 16.6% Trailing EBITDA Multiple New Revolving Credit Facility 3,105 8.0% 1.50x 1.30x 24.9% 4.0x $2,881 $3,622 $4,488 Total Sources $12,460 3.00x 2.61x 100.0% 5.0x 3,717 4,583 5,594 6.0x 4,553 5,544 6,699 Uses of Funds Amount Rate %Uses Proceeds to Seller 11,264 90.4% Summary Credit Statistics Rollover 1,250 10.0% Balance Sheet Cash (1,554) 2.0% (12.5%) 2014PF 2015P Short-Term Notes Payable -- --- EBITDA/Tot. Int. Exp. 4.2x 4.8x Line of Credit 1,000 8.0% EBITDA-Capex/Tot. Int. Exp. 3.2x 3.7x Longterm Debt 500 4.0% Advisory Fees -- --- Total Debt/EBITDA 3.2x 2.8x Financing Fees -- --- Senior Debt/EBITDA 2.5x 2.2x Total Uses $12,460 100.0% Total Debt/Total Cap 0.5x 0.5x
Transcript of LBO_Model
ABC Company, Inc. Recapitalization Analysis(figures in U.S. dollars, thousands)
Key Inputs & Assumptions OutputsCompany Name: ABC Company, Inc. Exit EBITDA Multiple: 5.0x FYE Ended:Company Fiscal Year Ended: 12/31/14 Exit EBITDA Sensitivity: 1.0x 2017 2018 2019 2020Date of Transaction Analysis: 9/25/14 Total Sources/2014E EBITDA: 6.0x Summary of Equity Sponsor ReturnsDate of Transaction Offer: 12/31/14 Interest Rate (1=Avg., 2=Beg., 3 Trailing EBITDA MultiplePro Forma Year: 2014 Paydown Debt? ("Yes", "No") No 4.0x 15.4% 17.9% 19.1% 19.6%
5.0x 25.6% 25.0% 24.4% 23.9%Sources of Funds Amount Ownership Opt/Warr Diluted %Sources 6.0x 34.4% 31.1% 29.0% 27.5%New Equity Sponsor 5,000 80.0% --- 70.8% 40.1%Rollover 1,250 20.0% 10.0% 26.5% 10.0% Summary of Mezzanine Holder ReturnsNew Mezzanine w/ Warrants -- --- 3.0% 2.7% --- Trailing EBITDA Multiple
100.0% 13.0% 100.0% 4.0x 17.8% 16.8% 16.3% 15.9%5.0x 19.9% 18.4% 17.6% 17.1%
Debt / EBITDA 6.0x 21.9% 20.0% 18.9% 18.2%Rate 2014E 2015P
New Mezzanine w/ Warrants 1,035 10.0% 0.50x 0.43x 8.3% Value of Management StakeNew Senior Notes 2,070 9.0% 1.00x 0.87x 16.6% Trailing EBITDA MultipleNew Revolving Credit Facility 3,105 8.0% 1.50x 1.30x 24.9% 4.0x $2,881 $3,622 $4,488 $5,500 Total Sources $12,460 3.00x 2.61x 100.0% 5.0x 3,717 4,583 5,594 6,771
6.0x 4,553 5,544 6,699 8,042 Uses of Funds Amount Rate %UsesProceeds to Seller 11,264 90.4% Summary Credit StatisticsRollover 1,250 10.0%Balance Sheet Cash (1,553) 2.0% (12.5%) 2014PF 2015P 2016PShort-Term Notes Payable -- --- EBITDA/Tot. Int. Exp. 4.2x 4.8x 5.6xLine of Credit 1,000 8.0% EBITDA-Capex/Tot. Int. Exp. 3.2x 3.7x 4.4xLongterm Debt 500 4.0%Advisory Fees -- --- Total Debt/EBITDA 3.2x 2.8x 2.5xFinancing Fees -- --- Senior Debt/EBITDA 2.5x 2.2x 1.9xTotal Uses $12,460 100.0% Total Debt/Total Cap 0.5x 0.5x 0.5x
ABC Company, Inc. Income Statement (figures in U.S. dollars, thousands)
FYE December 31: 2013A 2014E 2015P 2016P 2017P 2018P 2019P 2020P
Net Sales $15,000 $17,250 $19,838 $22,813 $26,235 $30,170 $34,696 $39,900Sales Growth 15.0% 15.0% 15.0% 15.0% 15.0% 15.0% 15.0%COGS 9,000 10,350 11,903 13,688 15,741 18,102 20,818 23,940Gross Profit 6,000 6,900 7,935 9,125 10,494 12,068 13,878 15,960Gross Margin (% of Sales) 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0%
SG&A Expense 4,600 5,290 6,083 6,996 8,045 9,252 10,640 12,236% of Sales 30.7% 30.7% 30.7% 30.7% 30.7% 30.7% 30.7% 30.7%Operating Profit (EBIT) 1,400 1,610 1,852 2,129 2,449 2,816 3,238 3,724
Depreciation & Amortization Expense 400 460 529 608 700 805 925 1,064% of Sales 2.7% 2.7% 2.7% 2.7% 2.7% 2.7% 2.7% 2.7%EBITDA 1,800 2,070 2,381 2,738 3,148 3,620 4,164 4,788% of Sales 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0%
Net Interest Expense 150 150 498 486 471 453 431 405Pretax Income (EBT) 1,250 1,460 1,354 1,643 1,977 2,363 2,807 3,319
Taxes 500 584 514 624 751 898 1,067 1,261Effective Tax Rate 40.0% 40.0% 38.0% 38.0% 38.0% 38.0% 38.0% 38.0%Net Income 750 876 839 1,019 1,226 1,465 1,740 2,058% of sales 5.0% 5.1% 4.2% 4.5% 4.7% 4.9% 5.0% 5.2%
ABC Company, Inc. Cashflow Statement(figures in U.S. dollars, thousands)
FYE December 31: 2014E 2015P 2016P 2017P 2018P 2019P 2020P
Net Income / (Loss) $876 $839 $1,019 $1,226 $1,465 $1,740 $2,058Depreciation 460 529 608 700 805 925 1,064Change in Accounts Receivable (225) (259) (298) (342) (394) (453) (520)Change in Inventory (188) (216) (248) (285) (328) (377) (434)Change in Prepaid Expenses (15) (17) (20) (23) (26) (30) (35)Change in Accounts Payable 75 86 99 114 131 151 173Change in Accrued Expenses 30 35 40 46 52 60 69Total Operating Activities $1,013 $997 $1,201 $1,435 $1,705 $2,017 $2,376
Capital Expenditures (460) (529) (608) (700) (805) (925) (1,064)Total Investing Activities ($460) ($529) ($608) ($700) ($805) ($925) ($1,064)
Dividends -- -- -- -- -- -- --Equity Issued -- -- -- -- -- -- --Short-Term Notes Payable -- -- -- -- -- -- --Change in Line of Credit -- -- -- -- -- -- --Change in Longterm Debt -- -- -- -- -- -- --New Mezzanine w/Warrants -- -- -- -- -- -- --New Senior Notes -- -- -- -- -- -- --New Revolving Credit Facility -- -- -- -- -- -- --Total Financing Activities -- -- -- -- -- -- --
Change in Cash +/(-) 553 468 592 736 901 1,092 1,312Beginning Cash Balance 1,000 1,553 2,022 2,614 3,350 4,251 5,342Ending Cash Balance $1,553 $2,022 $2,614 $3,350 $4,251 $5,342 $6,654
ABC Company, Inc. Balance Sheet(figures in U.S. dollars, thousands)
FYE December 31: 2013A 2014E 2014PF 2015P 2016P 2017P 2018P 2019P 2020PMinimum Cash $500 $500 $500 $500 $500 $500Cash & Cash Equivalents 1,000 1,553 $1,553 $2,022 $2,614 $3,350 $4,251 $5,342 $6,654Accounts Receivable 1,500 1,725 1,725 1,984 2,281 2,624 3,017 3,470 3,990Inventory 1,250 1,438 1,438 1,653 1,901 2,186 2,514 2,891 3,325Prepaid Expenses 100 115 115 132 152 175 201 231 266Total Current Assets 3,850 4,831 4,831 5,791 6,949 8,334 9,983 11,934 14,235
Net Property, Plant & Equipment 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000Intangible Assets / Goodwill -- -- 7,934 7,934 7,934 7,934 7,934 7,934 7,934Deposits -- -- -- -- -- -- -- -- --Total Noncurrent Assets 1,000 1,000 8,934 8,934 8,934 8,934 8,934 8,934 8,934
Total Assets 4,850 5,831 13,765 14,725 15,883 17,268 18,917 20,868 23,169
Accounts Payable 500 575 575 661 760 875 1,006 1,157 1,330Accrued Expenses 200 230 230 265 304 350 402 463 532Total Current Liabilities 700 805 805 926 1,065 1,224 1,408 1,619 1,862
Other Non-Current Liabilities -- -- -- -- -- -- -- -- --
Short-Term Notes Payable -- -- -- -- -- -- -- -- --Line of Credit 1,000 1,000 -- -- -- -- -- -- --Longterm Debt 500 500 500 500 500 500 500 500 500New Mezzanine w/ Warrants -- -- 1,035 1,035 1,035 1,035 1,035 1,035 1,035New Senior Notes -- -- 2,070 2,070 2,070 2,070 2,070 2,070 2,070New Revolving Credit Facility -- -- 3,105 3,105 3,105 3,105 3,105 3,105 3,105Total Long-Term Debt 1,500 1,500 6,710 6,710 6,710 6,710 6,710 6,710 6,710
Total Liabilities 2,200 2,305 7,515 7,636 7,775 7,934 8,118 8,329 8,572
Total Shareholders' Equity 2,650 3,526 6,250 7,089 8,108 9,334 10,799 12,539 14,597
Total Liabilities & Shareholders' Equity 4,850 5,831 13,765 14,725 15,883 17,268 18,917 20,868 23,169Balance 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
ABC Company, Inc. Financial Statement Assumptions(figures in U.S. dollars, thousands)
FYE December 31: 2013A 2014E 2015P 2016P 2017P 2018P 2019P 2020P
Capital Expenditures (% of Sales) 2.7% 2.7% 2.7% 2.7% 2.7% 2.7% 2.7% 2.7%Capital Expenditures 400 460 529 608 700 805 925 1,064
Assets (Sales days)Accounts Receivable 36.5 36.5 36.5 36.5 36.5 36.5 36.5 36.5 Inventory 50.7 50.7 50.7 50.7 50.7 50.7 50.7 50.7 Prepaid Expenses 2.4 2.4 2.4 2.4 2.4 2.4 2.4 2.4
Liabilities (COGS days)Accounts Payable 20.3 20.3 20.3 20.3 20.3 20.3 20.3 20.3 Accrued Expenses 8.1 8.1 8.1 8.1 8.1 8.1 8.1 8.1
Working CapitalCurrent Ratio 5.5x 6.0x 6.3x 6.5x 6.8x 7.1x 7.4x 7.6xNet Working Capital 2,150 2,473 2,843 3,270 3,760 4,324 4,973 5,719Change in Net Working Capital 323 371 427 490 564 649 746
