Financial Model
Velocity Avionics
John Stewartson, CFO
*** Proprietary & Confidential ***
The Velocity Financial Model is owned by Velocity’s CFO and is
restricted to authorized users only. To use this confidential tool, you
must first obtain the authorization of Mr. John Stewartson
This model is used by the Executive Management Team (EMT) to create a five-year operating
budget for Velocity. At the start of each year, the CFO updates the forecast based on projections
and estimates supported by the EMT.
There are two versions of the model loaded onto the Velocity Company Info site accessible
through Canvas:
1. Velocity Financial Model 2022-2026 Forecast CFO Base Case WITH Dividends
2. Velocity Financial Model 2022-2026 Forecast CFO Base Case EX Dividends
As Base Case Models, both include no implementation of NextGEN Task Force Proposals. The
first includes reinstatement of the $10 million annual dividend in 2023 and beyond, as well as the
debt required to make the payments. The second excludes dividends and any extra debt
required to pay them.
The WITH Dividends version represents the forecast for the performance of the company
assuming no impact from implementation of the results of the NextGEN project.
The EX Dividends version should be used by the EMT and the consultants for the Delta Analyses
to evaluate the incremental impact of each of the NextGEN Task Force Proposals.
2
To use the Velocity Financial Model, download the native Excel file(s) for
the version(s) you wish to use and save to the drive on your computer –
the spreadsheet is NOT compatible with Google Sheets
To use the model, open the Base Case EX Dividends version and then “Save As” to your drive
with any name you wish to use. As you evaluate Task Force Proposals, ensure that you keep an
unchanged version of the Base Case on your drive to use as a template. You will see tabs in
which you may enter planning parameters in the BLUE input areas.
areas are
calculated by formula and should not be adjusted. Blended BLUE /
areas are
calculated but may be overwritten.
To evaluate a Task Force Proposal, enter planning parameters for demand, pricing, costs, and
investments in the appropriate tabs. New purchases and/or divestitures of factory equipment
should be entered in the Factory & Equipment tab. CAPEX for non-factory equipment and
project-specific costs should be entered in the Special Projects tab. Once all planning
parameters are entered, the model calculates pro-forma financial statements, key performance
indicators (KPI’s), and a Delta Analysis vs the EX Dividends Base Case over a 5-year horizon.
The Model draws on long-term debt as required to fund proposals. As such, you must review
debt covenants in the Cash Flows tab to confirm you haven’t created an issue with existing debt
facilities. If your scenario violates any covenants you will need to adjust debt accordingly. For
3
each incremental Delta Analysis, dividends should be be kept at $0.
The Velocity Financial Model has been revised so that high-level
revenues and costs for running a new OBU can be included
To enable analysis of the impact of a new Organization Business Unit (OBU) on Velocity’s
performance, the Velocity Financial Model has been modified to include a “New OBU” tab.
Revenue targets can be entered along with operational cost estimates by entering assumed
gross margins and SG&A as a percent of sales. The model will integrate these new costs with
those for operating the legacy business, which is embedded in the tool. The “New OBU” tab is
designed for the user to enter only ongoing operating costs. All startup and special project costs
associated with a new OBU must be entered under the “Facilities & Equipment” and “Special
Projects” tabs.
To make it clear which tab is used to assess a new OBU vs the Legacy Business, the tabs have
been color coded as follows:
PURPLE Tab – New OBU Planning
GRAY Tabs
– Legacy Business Planning
ORANGE Tabs – Combined Legacy and New OBU
4
The Velocity Financial Model has also been revised to include a
Delta Analysis tab for use in tabulating the impact of each of the
NextGEN Task Force Proposals
A summary of the impact of a Task Force Proposals may be found by going to the
BLUE Tab – Delta Analysis
The data in this tab have been formatted to be compatible with the Velocity EMT Task Force
Proposal Financial Attractiveness Assessment template that our consultants have created to
compile the financial analysis results of all the Delta Analyses in one table.
To copy the Delta Analysis results for an individual Task Force Proposal from the Financial Model
to the consultants’ template, select all of the cells in the appropriate column of data (excluding
the label at the top) and then click on Copy in the Edit drawdown menu in Excel. With your copy
of the summary template also open on your computer, you should then paste the column of data
into the appropriate column in the template by clicking on Paste Special > Values in the Edit
drawdown menu. Please make sure you paste Values, otherwise the data in the summary
template will be incorrect. In the template you will be able to enter a label for the scenario above
the column of data.
5
How to use the Financial Model
BLUE areas
YELLOW areas
BLUE / YELLOW
•
– input your parameters
– formula driven
– formula, but can be edited
To use:
– Download a copy of the Excel .xlsx file to your local drive.
– When you open the file, you will need to click Enable Macros in the dialog box
– If worksheet tabs at the bottom do not open:
• Select “Enable Content” from the yellow ribbon bar.
• Under “View”, select “Macros” at the far right. Select “View Macros”, and
run the “Author” macro. This will open all of the worksheet tabs
– Enter all planning parameters and generate five-year projections. See resulting
tabs for Income Statement, Balance Sheet, Cash Flows, Performance Metrics,
and Delta Analysis
6
Enabling Macros in Excel
or
Click here
You may need to do the following before you can run macros:
•
•
•
If the Macros tab is not available:
• Click the File tab, click Options, and then click the Customize Ribbon or Trust
Center.
To set the security level temporarily to enable all macros, do the following:
• In the Macro Settings category, under Macro Settings, click “Enable all macros (not
recommended; potentially dangerous code can run)”, and then click OK.
To help prevent potentially dangerous code from running, return to any one of the settings
that disable all macros after you finish working with the tool.
7
Running the “Author” Macro
Select
“View Macros”
Select
“Author” and
Run the Macro
8
Forecasting a Five-Year Pro-Forma
of
Velocity Performance
9
Make Required Inputs
Sheet
Business Planning Parameter(s)
New OBU
Demand, Price, Gross Margin, Additive SG&A
Demand Forecast
Marketing Plan: Growth, Returns %, Price
Changes
Expense Planning
Material, Transportation, Utilities/Insurance,
Scrap, SG&A Budgets, Spending Cuts
Inventory Targets
RAW Materials, WIP, Finished Goods
F&E (CAPEX)
F&E: Sell-offs, Upgrades, New Capacity
Special Projects
CAPEX and OPEX by Year
Direct Costs of TFPs, New OBU Start-up Costs
Labor
Staffing Levels, COLA, Variable and Fixed
Factory Labor, SG&A
Cash Flows
Raising and repaying of Short- and Long-Term
Debt, Dividends, Cash from Equity Financing and
Government Subsidies
10
New OBU
Demand Forecast
Expense Planning
Some Tips for a
Key Areas
Labor
Inventory
Facilities & Equipment
Special Projects
Cash Flows
Delta Analysis
11
New OBU
New OBU Demand and Pricing
FORECAST FOR NEW OBU
NEW REVENUE
Unit
2022
2023
2024
2025
2026
MARKETING PLAN: UNIT SALES GROWTH
%
0.0%
0.0%
0.0%
0.0%
PROJECTED ANNUAL UNIT SALES
#
0
0
0
0
PROJECTED UNIT SALES/DAY
#
0
0
0
0
UNIT PRICE CHANGE
%
0.0%
0.0%
0.0%
0.0%
AVERAGE UNIT PRICE
$
PROJECTED ANNUAL SALES REVENUE:
$
0
$0
Enter starter values here or in subsequent
years based on time to market.
$0
$0
$0
$0
$0
$0
$0
$0
Enter your growth projections as either
a percentage or in numbers.
NEW OPERATING EXPENSE
TARGET GROSS MARGIN
%
0.0%
0.0%
0.0%
0.0%
0.0%
ESTIMATED GROSS MARGIN
$
$0
$0
$0
$0
$0
ESTIMATED COST OF GOODS SOLD (COGS)
$
$0
$0
$0
$0
$0
ADDITIVE SG&A (AS % OF SALES)
%
0%
0%
0%
0%
0%
ESTIMATED ADDITIONAL SG&A COSTS
$
$0
$0
$0
$0
$0
$
$0
$0
$0
$0
$0
ESTIMATED OPERATING EXPENSE:
Enter expected gross margin based on
market research. Resulting COGs are
additive and mutually exclusive to the
Legacy Business. Only depreciation of
Facilities & Equipment will be a COGs
shared cost.
Ramp up SG&A costs over time for the
new OBU. These are additive and noninclusive of the Legacy Business. The new
OBU may lever a portion of the existing
legacy SG&A until the pandemic crunch
ceases.
12
Demand Forecast
Legacy Business Demand and Pricing
Starter values have been pre-populated
here based on 2021 actuals
Enter unit volume projections as either
a percentage change from the prior
year or in numbers.
FORECAST OF SALES ACTIVITY
2021
MARKETING PLAN: UNIT SALES GROWTH
PROJECTED ANNUAL UNIT SALES
2022
2023
2024
2025
2026
42.9%
15.0%
26.1%
5.2%
4.9%
7,000
10,000
11,500
14,500
15,250
16,000
RETURN PERCENTAGE - WARRANTY
3%
3.0%
3.0%
3.0%
3.0%
3.0%
ANNUAL WARRANTY SHIPMENTS
210
300
345
435
457
480
41
47
60
63
66
PROJECTED UNIT SALES/DAY
UNIT PRICE CHANGE
AVERAGE UNIT PRICE
PROJECTED ANNUAL SALES REVENUE:
GROSS ANNUAL PRODUCTION REQUIRED:
$22,450
$157,150,000
7,602
1.0%
0.0%
1.0%
0.0%
0.0%
$22,675
$22,675
$22,901
$22,901
$22,901
$226,745,000
$260,756,750
$332,068,125
$349,244,063
$366,420,000
10,860
12,489
15,747
16,561
17,376
Enter annual pricing change either as a
percentage change from the prior year
or in numbers
Enter returns as a percentage of annual
volume
13
Inventory
Inventory
2021
DAILY PRODUCTION
MATERIAL UNIT COST
RAW - IMPROVEMENT / GAIN
RAW - PLANNING FACTOR (DAYS)
TOTAL RAW MATERIAL:
TOTAL WORK-IN-PROCESS:
TOTAL FINISHED GOODS:
2024
2025
2026
47
61
65
69
$14,980
$15,130
$15,281
$15,434
$15,588
0%
-10%
6.8
$4,799,983
0%
0%
0%
6.8
6.8
6.8
$6,292,063
$6,771,703
$7,260,307
7.5
$3,225,927
$4,606,402
25.0
25.0
$10,753,091
$15,354,674
14.0
14.0
$6,021,731
$8,598,618
0%
FINI - IMPROVEMENT / GAIN
FINI - PLANNING FACTOR (DAYS)
2023
41
7.5
WIP - IMPROVEMENT / GAIN
WIP - PLANNING FACTOR (DAYS)
2022
0%
Change in Inventory: Enter
overall changes in inventory
levels as a % change from each
prior year
-20%
20.0
$14,222,172
-15%
11.9
$8,462,192
0%
0%
0%
20.0
20.0
20.0
$18,643,149
$20,064,304
$21,512,020
0%
0%
0%
11.9
11.9
11.9
$11,092,674
$11,938,261
$12,799,652
Inventory Level: The Model
calculates the level of inventory
based on production level and
change in overall level
14
Operating Expenses
•
The modeling tool will help you address costs associated with increases or
decreases to production
•
The tool automates most of the capacity related costs when a change occurs to
annual production levels, however, a few costs must be input manually,
details follow
•
Utilize the four Capacity Planning Parameter Tables in conjunction with the
modeling tool to capture all costs.
Expense Planning Legacy only
Labor Legacy only
Facilities & Equipment
New OBU and Legacy
(shared resource)
15
Expense Planning
Expense Planning – SG&A Expense
SG&A BUDGETING (NON-LABOR)
SALES & MARKETING - PLANNING FACTOR (% of Sales)
TOTAL
FINANCE -
PLANNING FACTOR (% of Sales)
TOTAL
HUMAN RESOURCES - PLANNING FACTOR (% of Sales)
TOTAL
I/T -
PLANNING FACTOR (% of Sales)
TOTAL
R&D + ENGINEERING - PLANNING FACTOR (% of Sales)
TOTAL
ADMIN -
PLANNING FACTOR (% of Sales)
TOTAL
1.75%
1.75%
1.75%
1.75%
1.75%
1.75%
$2,062,594
$2,976,028
$4,563,243
$5,811,192
$6,111,771
$6,412,350
0.28%
0.30%
0.30%
0.30%
0.30%
0.30%
$353,588
$510,176
$782,270
$996,204
$1,047,732
$1,099,260
0.50%
0.50%
0.50%
0.50%
0.50%
0.50%
$589,313
$850,294
$1,303,784
$1,660,341
$1,746,220
$1,832,100
0.27%
0.30%
0.30%
0.30%
0.30%
0.30%
$353,588
$510,176
$782,270
$996,204
$1,047,732
$1,099,260
0.31%
0.30%
0.30%
0.30%
0.30%
0.30%
$353,588
$510,176
$782,270
$996,204
$1,047,732
$1,099,260
0.39%
0.40%
0.40%
0.40%
0.40%
0.40%
$471,450
$680,235
$1,043,027
$1,328,273
$1,396,976
$1,465,680
$6,037,085
$9,256,864
$11,788,418
$12,398,163
$13,007,910
25%
0%
0%
0%
0%
TOTAL SG&A (NON-LABOR):
TEMPORARY SG&A SPENDING FREEZE/REDUCTION:
SG&A Expense: Enter any
adjustments – in % - to your
expense budget planning as a
result of operational
improvements for each category
The Model will automatically calculate
capacity related changes to each SG&A
Expense category (up to 100,000 units) using
the preloaded % from the Capacity Planning
Tables. The defaults may be modified if
necessary
16
Labor
Factory Labor
Table 1 - Options for Adding Factory Capacity
Capacity
Gain
2,500
10,000
10,000*
Option
Overtime
Second Shift
Additional Factory
2021 Labor
Equipment
Cost
Cost
$701 /unit (V)
$0
$8,771,645 (V)
$0
$8,771,645* (V)
$17,450,000
$9,585,195 (F)
V – Variable Labor
F – Fixed Labor
* - per shift
Facility
Cost
$0
$0
$32,000,000
LABOR PLANNING - FACTORY
Factory: Variable - COLA (or Other)
V-TOTAL
Factory: Fixed - COLA (or Other)
F-TOTAL
Variable Labor:
1) Enter - in % - the combined operational
productivity improvements and COLA
adjustments for each year
2) Variable labor cost total will load
automatically from the labor planning
engine.
2021
2022
2023
2024
2025
3%
3%
3%
3%
3%
2026
3%
$8,771,645
$9,655,208
$11,155,300
$19,170,026
$19,745,127
$20,337,481
3%
3%
3%
3%
3%
3%
$19,170,391
$9,872,751
$10,168,934
$10,474,002
$10,788,222
$11,111,869
Fixed Labor:
1) Enter - in % - the combined operational
productivity improvements and COLA
adjustments for each year
2) Fixed labor cost total will load automatically
from the labor planning engine.
17
Labor
SG&A Labor
Sales & Marketing - COLA (or Other)
Capacity PUI ($)
TOTAL
Finance -
COLA (or Other)
Capacity PUI ($)
TOTAL
Human Resources - COLA (or Other)
Capacity PUI ($)
TOTAL
I/T -
COLA (or Other)
Capacity PUI ($)
TOTAL
R&D + Engineering - COLA (or Other)
Capacity PUI ($)
TOTAL
Admin -
COLA (or Other)
Capacity PUI ($)
TOTAL
SG&A Labor: For each function,
enter COLA – in % - in combination
with any other changes to your
labor cost as a result of
operational improvements
3%
3%
3%
3%
3%
3%
See capacity tables
$250
$250
$250
$250
$250
$4,157,595
$4,164,290
$4,664,219
$5,554,146
$5,908,270
$6,273,018
3%
3%
3%
3%
3%
3%
See capacity tables
$15
$15
$15
$15
$15
$1,294,401
$1,326,151
$1,388,436
$1,475,089
$1,530,592
$1,587,760
3%
3%
3%
3%
3%
3%
See capacity tables
$125
$125
$125
$125
$125
$2,231,833
$2,239,772
$2,494,465
$2,944,299
$3,126,378
$3,313,919
3%
3%
3%
3%
3%
3%
See capacity tables
$25
$25
$25
$25
$25
$1,380,235
$1,409,839
$1,489,634
$1,609,323
$1,676,353
$1,745,394
3%
3%
3%
3%
3%
3%
See capacity tables
$15
$15
$15
$15
$15
$937,509
$958,552
$1,009,809
$1,085,103
$1,128,906
$1,174,023
3%
3%
3%
3%
3%
3%
See capacity tables
$15
$15
$15
$15
$15
$1,079,831
$1,105,144
$1,160,798
$1,240,622
$1,289,091
$1,339,014
SG&A Capacity Per Unit Impact: The Model will
automatically calculate capacity related changes
to SG&A Labor (up to 100,000 units) using the PUI
from the Capacity Planning Tables. The PUI
defaults may be modified if necessary.
18
Facilities & Equipment
Facilities & Equipment
Table 1 - Options for Adding Factory Capacity
Option
Overtime
Second Shift
Additional Factory
* - per shift
Capacity
Gain
2,500
10,000
10,000*
2021 Labor
Equipment
Cost
Cost
$701 /unit (V)
$0
$8,771,645 (V)
$0
$8,771,645* (V)
$17,450,000
$9,585,195 (F)
V – Variable Labor
F – Fixed Labor
Facility
Cost
$0
$0
$32,000,000
Table 2 - Adding Warehouse Capacity
Capacity
2021 Labor
Equipment
Facility
Option
Gain
Cost
Cost
Cost
Add a Warehouse
4,000*
n/a
$12,000,000
$25,000,000
* - 68,500 annual unit production at current finished goods inventory levels
If you reach production levels
that require additional
Equipment or Facilities, you
must manually make additions
for each here
Combine New OBU and
Legacy unit production together
when evaluating F&E
Note: new office space is needed if total SG&A heads exceed 275
19
Special Projects
Special Project Costs
CAPEX will be added by the
Model to the Depreciation
Schedule automatically
Add both New OBU
and Legacy items
in this tab
Capture all CAPEX and
OPEX start-up costs for
improvement initiatives and
New OBUs
Clearly identify the initiative via its
description, use the Task Force
Proposal number as project number
20
Cash Flows
Cashflow is managed
for the combined entity,
New OBU and Legacy
Manage Cash
If an opportunity arises to raise
private equity financing, enter it here.
CASH FROM EQUITY FINANCING / GOV'T BAILOUT
TOTAL CASH USED BEFORE DIVIDENDS
0
0
0
0
0
(1,000,000)
(4,900,000)
(5,200,000)
(1,100,000)
(1,700,000)
PURCHASE OF EQUIPMENT
0
0
0
0
0
REPAYMENT OF LONG-TERM DEBT
0
(1,500,000)
2,000,000
500,000
0
REPAYMENT OF SHORT-TERM DEBT
(1,000,000)
(3,400,000)
(7,200,000)
(1,600,000)
(1,700,000)
(4,069,263)
9,582,309
10,350,954
9,919,581
10,180,226
0
10,000,000
10,000,000
10,000,000
10,000,000
(4,069,263)
(417,691)
350,954
(80,419)
180,226
NET CASH FLOW BEFORE DIVIDENDS
DIVIDENDS PAID
NET CASH FLOW
Make long-term and short-term debt payments
so that borrowing covenants are honored. Draw
on short-term debt if needed. Ignore dividends
for incremental Delta Analyses
2022
2023
2024
2025
2026
0.80
0.80
0.80
0.80
0.80
Short-Term Debt
$22,594,980
$25,994,980
$33,194,980
$34,794,980
$36,494,980
Accounts Receivable
$28,343,125
$32,594,594
$41,508,516
$43,655,508
$45,802,500
0.80
0.80
0.80
0.80
0.80
Short-Term Debt/AR Ratio Cap
Short-Term Debt/AR Ratio
PASS
PASS
PASS
PASS
PASS
Long-Tern Debt Cap
Compliance
$40,000,000
$40,000,000
$40,000,000
$40,000,000
$40,000,000
Total Long-Term Debt
$25,942,972
$30,042,972
$37,942,972
$37,442,972
$37,442,972
PASS
PASS
PASS
PASS
PASS
Compliance
Long-Tern Debt/EBITDA Ratio Cap
EBITDA
Long-Term Funded Debt/EBITDA
Compliance
3.0
3.0
3.0
3.0
3.0
$8,674,270
$12,886,598
$13,373,274
$20,136,690
$19,307,383
3.0
2.3
2.8
1.9
1.9
PASS
PASS
PASS
PASS
PASS
21
Ensure Balance Sheet Integrity
BALANCE SHEET
2022
2023
2024
2025
2026
106,304,765
107,558,644
120,270,806
119,761,708
120,526,429
63,679,050
72,019,683
90,852,754
95,498,721
100,452,663
CASH
6,776,231
6,358,541
6,709,494
6,629,075
6,809,302
ACCOUNTS RECEIVABLE
28,343,125
32,594,594
41,508,516
43,655,508
45,802,500
INVENTORY
28,559,694
33,066,549
42,634,744
45,214,138
47,840,861
RAW MATERIAL
4,606,402
5,333,314
6,876,572
7,292,603
7,716,268
WORK IN PROCESS
15,354,674
17,777,715
22,921,905
24,308,676
25,720,893
FINISHED GOODS
8,598,618
9,955,520
12,836,267
13,612,859
14,403,700
LONG TERM ASSETS
42,625,714
35,538,961
29,418,052
24,262,987
20,073,766
PROPERTY
9,750,000
9,750,000
9,750,000
9,750,000
9,750,000
PLANT
21,985,714
18,057,143
14,557,143
11,485,714
8,842,857
EQUIPMENT
10,890,000
7,731,818
5,110,909
3,027,273
1,480,909
ASSETS
CURRENT ASSETS
SPECIAL PROJECTS
0
0
0
0
0
64,490,358
73,986,183
94,328,509
96,161,016
99,224,193
CURRENT LIABILITIES
38,547,386
43,943,211
56,385,537
58,718,044
61,781,221
SHORT TERM DEBT
22,594,980
25,994,980
33,194,980
34,794,980
36,494,980
ACCOUNTS PAYABLE
13,895,795
15,687,101
20,296,250
20,927,485
22,167,389
PAYROLL DUE
1,280,488
1,397,150
1,814,692
1,883,039
1,953,437
776,123
863,980
1,079,615
1,112,540
1,165,415
LIABILITIES
OTHER ACCRUALS
LONG TERM LIABILITIES
25,942,972
30,042,972
37,942,972
37,442,972
37,442,972
LONG TERM DEBT
25,942,972
30,042,972
37,942,972
37,442,972
37,442,972
SHAREHOLDER EQUITY
41,814,407
33,572,461
25,942,296
23,600,692
21,302,236
OK
OK
OK
OK
OK
BALANCE CHECK (Within $1)
Must be OK
22
Resulting Financial Statements
(Based on your business planning inputs)
INCOME STATEMENT
REVENUES
NEW OBU SALES
LEGACY SALES
2022
2023
2024
2025
2026
226,745,000
260,756,750
332,068,125
349,244,063
366,420,000
0
0
0
0
0
226,745,000
260,756,750
332,068,125
349,244,063
366,420,000
EXPENSES
229,485,984
258,473,562
328,990,417
339,298,094
356,417,995
COST OF GOODS SOLD
202,032,538
225,788,023
289,266,863
297,067,820
312,199,487
NEW SBU COGS
VARIABLE MANUFACTURING COST
MATERIAL
0
0
0
0
0
176,404,749
199,400,511
262,725,027
270,874,945
286,346,148
166,749,540
188,245,211
243,555,001
251,129,818
266,008,667
9,655,208
11,155,300
19,170,026
19,745,127
20,337,481
25,627,790
26,387,512
26,541,836
26,192,874
25,853,339
FIXED LABOR
9,872,751
10,168,934
10,474,002
10,788,222
11,111,869
UTILITIES, TAXES, AND INSURANCE
3,252,500
3,594,125
4,277,375
4,448,188
4,619,000
FACTIORY & EQUIPMENT DEPRECIATION
8,052,597
7,086,753
6,120,909
5,155,065
4,189,221
MAINTENANCE
5,405,850
5,537,700
5,669,550
5,801,400
5,933,250
OBSOLETE INVENTORY/EQUIPMENT
(955,909)
0
0
0
0
24,712,462
34,968,727
42,801,262
52,176,243
54,220,513
24,090,789
29,168,883
35,548,897
37,194,618
39,102,351
ADMINISTRATION
0
0
0
0
NEW OBU SG&A
0
0
0
0
SALES AND MARKETING
7,140,318
9,227,462
11,365,338
12,020,041
12,685,368
FINANCE
1,836,327
2,170,706
2,471,293
2,578,324
2,687,020
HUMAN RESOURCES
3,090,066
3,798,249
4,604,640
4,872,598
5,146,019
INFORMATION TECHNOLOGY
1,920,015
2,271,904
2,605,527
2,724,085
2,844,654
R&D AND ENGINEERING
1,468,728
1,792,079
2,081,307
2,176,638
2,273,283
ADMINISTRATION
1,785,379
2,203,825
2,568,895
2,686,067
2,804,694
0
0
0
0
0
788,980
931,017
1,173,891
1,234,570
1,295,328
DIRECT LABOR
FIXED MANUFACTURING COST
GROSS PROFIT
SELLING, GENERAL & ADMINISTRATION
INVENTORY HOLDING COSTS
SHIPPING AND EXPEDITED FREIGHT
WARRANTY/ALLOWANCES
BALANCE SHEET
ASSETS
2022
2023
2024
2025
2026
106,304,765
107,558,644
120,270,806
119,761,708
120,526,429
100,452,663
CURRENT ASSETS
63,679,050
72,019,683
90,852,754
95,498,721
CASH
6,776,231
6,358,541
6,709,494
6,629,075
6,809,302
ACCOUNTS RECEIVABLE
28,343,125
32,594,594
41,508,516
43,655,508
45,802,500
INVENTORY
28,559,694
33,066,549
42,634,744
45,214,138
47,840,861
RAW MATERIAL
4,606,402
5,333,314
6,876,572
7,292,603
7,716,268
WORK IN PROCESS
15,354,674
17,777,715
22,921,905
24,308,676
25,720,893
FINISHED GOODS
8,598,618
9,955,520
12,836,267
13,612,859
14,403,700
LONG TERM ASSETS
42,625,714
35,538,961
29,418,052
24,262,987
20,073,766
PROPERTY
9,750,000
9,750,000
9,750,000
9,750,000
9,750,000
PLANT
21,985,714
18,057,143
14,557,143
11,485,714
8,842,857
0
EQUIPMENT
10,890,000
7,731,818
5,110,909
3,027,273
1,480,909
0
SPECIAL PROJECTS
0
0
0
0
0
64,490,358
73,986,183
94,328,509
96,161,016
99,224,193
CURRENT LIABILITIES
38,547,386
43,943,211
56,385,537
58,718,044
61,781,221
SHORT TERM DEBT
22,594,980
25,994,980
33,194,980
34,794,980
36,494,980
ACCOUNTS PAYABLE
13,895,795
15,687,101
20,296,250
20,927,485
22,167,389
PAYROLL DUE
1,280,488
1,397,150
1,814,692
1,883,039
1,953,437
776,123
863,980
1,079,615
1,112,540
1,165,415
25,942,972
30,042,972
37,942,972
37,442,972
37,442,972
6,060,976
6,773,641
8,678,006
8,902,295
9,365,985
SPECIAL PROJECTS
0
0
0
0
0
SPECIAL PROJECTS DEPRECIATION
0
0
0
0
0
OPERATING PROFIT
INTEREST EXPENSE
LIABILITIES
OTHER ACCRUALS
LONG TERM LIABILITIES
621,673
5,799,844
7,252,365
14,981,625
15,118,162
LONG TERM DEBT
25,942,972
30,042,972
37,942,972
37,442,972
37,442,972
3,362,657
3,516,657
4,174,657
5,035,657
5,116,157
SHORT TERM INTEREST (@7%)
1,546,649
1,700,649
2,071,649
2,379,649
2,495,149
SHAREHOLDER EQUITY
41,814,407
33,572,461
25,942,296
23,600,692
21,302,236
LONG TERM INTEREST (@7%)
1,816,008
1,816,008
2,103,008
2,656,008
2,621,008
(2,740,984)
2,283,188
10,002,005
INCOME BEFORE TAXES
3,077,708
9,945,968
(630,426)
525,133
707,873
2,287,573
(2,110,558)
1,758,054
2,369,835
7,658,396
7,701,544
DIVIDENDS PAID
0
10,000,000
10,000,000
10,000,000
10,000,000
CASH FROM GOVERNMENT BAILOUT
0
0
0
0
0
INCOME TAXES
NET INCOME
PERFORMANCE METRICS
2,300,461
INCREASE IN RETAINED EARNINGS
(2,110,558)
(8,241,946)
(7,630,165)
(2,341,604)
(2,298,456)
EBITDA
8,674,270
12,886,598
13,373,274
20,136,690
19,307,383
GROSS PROFIT
$24,712,462
$34,968,727
$42,801,262
$52,176,243
$54,220,513
10.9%
13.4%
12.9%
14.9%
14.8%
$621,673
$5,799,844
$7,252,365
$14,981,625
$15,118,162
$5,584,321
$11,535,851
$11,640,985
$1,758,054
$2,369,835
$7,658,396
$7,701,544
NET INCOME/TOTAL ASSETS (ROA)
-2.1%
1.6%
2.1%
6.4%
6.4%
7,701,544
OPERATING PROFIT/NET ASSETS (RONA)
0.7%
6.4%
7.8%
15.5%
15.8%
5,155,065
4,189,221
NET INCOME/OWNERS EQUITY (ROE)
0
0
(8,913,922)
(2,146,992)
(2,146,992)
LIABILITIES/OWNERS EQUITY (D/E)
1.00
1.39
2.14
2.89
3.26
(9,568,195)
(2,579,394)
(2,626,723)
4,609,149
631,235
1,239,904
AFTER TAX COST OF DEBT
5.4%
5.4%
5.4%
5.4%
5.4%
204,519
633,177
101,272
123,273
COST OF EQUITY
10.0%
10.0%
10.0%
10.0%
10.0%
2,600,000
9,900,000
0
0
WEIGHTED AVERAGE COST OF CAPITAL
7.7%
7.3%
6.9%
6.6%
6.5%
0
0
0
0
DAYS SALES OUTSTANDING (DSO)
46
46
46
46
46
0
2,600,000
9,900,000
0
0
UNITS/YEAR
10,000
11,500
14,500
15,250
16,000
1,815,000
0
0
0
0
UNIT PRICE
$22,675
$22,675
$22,901
$22,901
$22,901
0
0
0
0
0
MANUFACTURING COST/UNIT
$20,203
$19,634
$19,949
$19,480
$19,512
(1,000,000)
(4,900,000)
(5,200,000)
GROSS MARGIN/UNIT
$2,471
$3,041
$2,952
$3,421
$3,389
SGA/UNIT
$2,409
$2,536
$2,452
$2,439
$2,444
$336
$306
$288
$330
$320
$22,949
$22,476
$22,689
$22,249
$22,276
2025
2026
8,819,581
8,480,226
(6,884,263)
2,082,309
(4,749,046)
8,819,581
8,480,226
NET INCOME
(2,110,558)
1,758,054
2,369,835
7,658,396
DEPRECIATION
8,052,597
7,086,753
6,120,909
LOSS (GAIN) ON SALE OF EQUIPMENT
(955,909)
0
0
DECLINE (INCREASE) IN RECEIVABLES
(8,699,375)
(4,251,469)
DECLINE (INCREASE) IN INVENTORY
(8,558,945)
(4,506,855)
INCREASE (DECLINE) IN PAYABLES
5,539,535
1,791,306
INCREASE (DECLINE) IN ACCRUALS
(151,608)
0
FOR EQUIPMENT INVESTMENT (JAN)
0
FOR DIVIDENDS (DEC)
TOTAL CASH USED BEFORE DIVIDENDS
$366,420,000
$4,465,880
2024
5,150,954
CASH FROM EQUITY FINANCING / GOV'T BAILOUT
2026
$349,244,063
$478,688
2023
4,682,309
CASH FROM SALE OF EQUIPMENT
2025
$332,068,125
($2,110,558)
2022
CASH FROM FINANCING
2024
$260,756,750
OPERATING PROFIT
(5,069,263)
CASH FROM OPERATIONS
2023
$226,745,000
GROSS MARGIN
CASH FLOW STATEMENT
TOTAL CASH AVAILABLE
2022
TOTAL SALES
NET OPERATING PROFIT AFTER TAX (NOPAT)
NET INCOME
ECONOMIC VALUE ADDED (EVA)
-4.9%
4.7%
8.0%
30.9%
34.3%
($6,244,002)
($2,291,366)
($1,034,215)
$5,056,914
$5,408,367
(1,100,000)
(1,700,000)
PURCHASE OF EQUIPMENT
0
0
0
0
0
REPAYMENT OF LONG-TERM DEBT
0
(1,500,000)
2,000,000
500,000
0
REPAYMENT OF SHORT-TERM DEBT
(1,000,000)
(3,400,000)
(7,200,000)
(1,600,000)
(1,700,000)
(4,069,263)
9,582,309
10,350,954
9,919,581
10,180,226
UNIT COST
0
10,000,000
10,000,000
10,000,000
10,000,000
SELLING MARGIN/UNIT
($274)
$199
$212
$652
$625
(4,069,263)
(417,691)
350,954
(80,419)
180,226
SELLING MARGIN(%)
-1.2%
0.9%
0.9%
2.8%
2.7%
NET CASH FLOW BEFORE DIVIDENDS
DIVIDENDS PAID
NET CASH FLOW
INTEREST EXPENSE/UNIT
23
Delta Analysis
Compiling Delta Analyses
Results of the Delta Analysis
are calculated by the Financial
Model – no inputs are required
in this tab
To include the results of a Delta
Analysis into the overall
tabulation for all of the Task
Force Proposals:
• Make sure both the Financial
Model and the Delta
Analyses Template files are
open on your computer
• Select cells in the column
containing Delta Analysis
results
• Click Copy in the Edit
drawdown menu
• Paste the copied data into
the appropriate column in the
summary Template file by
clicking on the top cell of
appropriate column and then
click Paste Special in the
Edit drawdown menu, and
then selecting Values