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Revenue and Expense Projections 2007-2012

The document provides revenue and expense projections for a company from 2007 to 2012. It projects that service revenue will grow annually by 14% from 2007 to 2009 and 10-12% from 2010 to 2012. Total revenue, expenses, EBIT, cash flow and other line items are also projected. Key financial metrics like EBIT, revenue growth rates, capital expenditures and free cash flow are calculated over the projected period.

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517 views26 pages

Revenue and Expense Projections 2007-2012

The document provides revenue and expense projections for a company from 2007 to 2012. It projects that service revenue will grow annually by 14% from 2007 to 2009 and 10-12% from 2010 to 2012. Total revenue, expenses, EBIT, cash flow and other line items are also projected. Key financial metrics like EBIT, revenue growth rates, capital expenditures and free cash flow are calculated over the projected period.

Uploaded by

Anand
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Revenue Projections: 2007 2008 2009 2010 2011

Service Revenue 4,194.3 4,781.5 5,379.2 5,917.2


Service Revenue Growth 14.0% 14.0% 12.5% 10.0%

Equipment Revenue 314.8 358.8 403.7 444.1


Equipment Revenue/Service Revenue (1) 7.5% 7.5% 7.5% 7.5%

Total Revenue 4509.10 5140.38 5782.93 6361.22

Operating Expenses:
System Operating Expenses 838.9 956.3 1,075.8 1,183.4
System Operating Exp./Service Revenue 20.0% 20.0% 20.0% 20.0%

Cost of Equipment Sold 755.5 861.2 968.9 1,065.8


Equipment COGS 240.0% 240.0% 240.0% 240.0%

Selling, General & Administrative 1,803.6 2,056.2 2,313.2 2,544.5


SG&A/Total Revenue 40.0% 40.0% 40.0% 40.0%

Depreciation & Amortization 705.2 804.0 867.4 922.4


15.64% 15.64% 15.00% 14.50%
Tax Rate 40.0% 40.0% 40.0% 40.0%

Total Expenses 3397.96 3873.68 4357.89 4793.68


EBIT 405.91 462.74 557.60 645.16
Synergy EBIT 0.00 0.00 0.00 0.00
Total EBIT(1-Tax Rate) 244 278 335 387
Working Capital Assumptions (1):
Accounts Receivable 41.67x 41.67x 41.67x 41.67x
435.5 521.90 594.96 669.33 736.26
Days Sales Equip. Rev. 154.36x 154.36x 154.36x 154.36x
101 134.97 153.86 173.10 190.41
Prepaid Expenses 1.38% 1.38% 1.38% 1.38%
42 46.91 53.48 60.17 66.19
Accounts Payable 35.54x 35.54x 35.54x 35.54x
261 335.42 382.38 430.18 473.20
Deferred Serv. Revenue 14.01x 14.01x 14.01x 14.01x
143 163.25 186.11 209.37 230.31
Accrued Liabilities 6.85x 6.85x 6.85x 6.85x
59 64.61 73.65 82.86 91.15

Working Capital 115 140 160 180 198


Change In Working Capital 26 20 20 18

Capital Expenditures (2):


Capital Expenditures 631.3 719.7 867.4 970.1
Cap-x/Total Revenue 14.0% 14.0% 15.0% 15.3%

Reinvestment (48) (65) 20 66


Free Cash Flow 292 342 315 321
Terminal Value
PV of FCF 269 316 247 233
NPV Of FCF 10,506

Interest Expense 199 183 166 148


Interest Tax Shield@5.5% 10.945 10.065 9.13 8.14
Terminal Value
PV Of Tax Shield 10.37 9.04 7.78 6.57
NPV 39.15

Total Firm Value 10,545


Long Term Debt 1002.3
Equity Value 9,542
2012
6,331.4
7.0%

475.2
7.5%

6806.50

1,266.3
20.0%

1,140.4
240.0%

2,722.6
40.0%

952.9
14.00%
40.0%

5129.23
724.36
0.00
435

41.67x
787.80
154.36x
203.73
1.38%
70.82
35.54x
506.32
14.01x
246.43
6.85x
97.53
Total Asset 5,611.9 5,545.096 5,484.096 5,572.096
212 Reinvestment Rate -19.78% -23.28% 5.98%
14 RoC 4.39% 5.06% 6.00%
Growth Rate

1,055.0
15.5%

116
319
13,763
9,440

128
7.04

5.39
5,709.096 5,880.096
16.98% 26.68%
6.78% 7.39%
1.97%
Revenue Projections: 2007 2008 2009 2010 2011
Service Revenue 4,194.3 4,781.5 5,379.2 5,917.2
Service Revenue Growth 14.0% 14.0% 12.5% 10.0%

Equipment Revenue 314.8 358.8 403.7 444.1


Equipment Revenue/Service Revenue (1) 7.5% 7.5% 7.5% 7.5%

Total Revenue 4509.10 5140.38 5782.93 6361.22

Operating Expenses:
System Operating Expenses 838.9 956.3 1,075.8 1,183.4
System Operating Exp./Service Revenue 20.0% 20.0% 20.0% 20.0%

Cost of Equipment Sold 755.5 861.2 968.9 1,065.8


Equipment COGS 240.0% 240.0% 240.0% 240.0%

Selling, General & Administrative 1,803.6 2,056.2 2,313.2 2,544.5


SG&A/Total Revenue 40.0% 40.0% 40.0% 40.0%

Depreciation & Amortization 705.2 804.0 867.4 922.4


15.64% 15.64% 15.00% 14.50%
Tax Rate 40.0% 40.0% 40.0% 40.0%

Total Expenses 3397.96 3873.68 4357.89 4793.68


EBIT 405.91 462.74 557.60 645.16
Synergy EBIT 156.48 282.00 413.16 622.49
Total EBIT(1-Tax Rate) 337 447 582 761
Working Capital Assumptions (1):
Accounts Receivable 41.67x 41.67x 41.67x 41.67x
435.5 521.90 594.96 669.33 736.26
Days Sales Equip. Rev. 154.36x 154.36x 154.36x 154.36x
101 134.97 153.86 173.10 190.41
Prepaid Expenses 1.38% 1.38% 1.38% 1.38%
42 46.91 53.48 60.17 66.19
Accounts Payable 35.54x 35.54x 35.54x 35.54x
261 335.42 382.38 430.18 473.20
Deferred Serv. Revenue 14.01x 14.01x 14.01x 14.01x
143 163.25 186.11 209.37 230.31
Accrued Liabilities 6.85x 6.85x 6.85x 6.85x
59 64.61 73.65 82.86 91.15

Working Capital 115 140 160 180 198


Change In Working Capital 26 20 20 18

Capital Expenditures (2):


Capital Expenditures 631.3 719.7 867.4 970.1
Cap-x/Total Revenue 14.0% 14.0% 15.0% 15.3%

Reinvestment (48) (65) 20 66


Free Cash Flow 386 511 562 695
Terminal Value
PV of FCF 356 472 442 505
NPV Of FCF 21,469

Interest Expense 199 183 166 148


Interest Tax Shield@5.5% 10.945 10.065 9.13 8.14
Terminal Value
PV Of Tax Shield 10.37 9.04 7.78 6.57
NPV 39.15

Total Firm Value 21,508


Long Term Debt 1002.3
Equity Value 20,506
2012
6,331.4
7.0%

475.2
7.5%

6806.50

1,266.3
20.0%

1,140.4
240.0%

2,722.6
40.0%

952.9
14.00%
40.0%

5129.23
724.36
780.43
903

41.67x
787.80
154.36x
203.73
1.38%
70.82
35.54x
506.32
14.01x
246.43
6.85x
97.53
Total Asset 5,611.9 5,545.096 5,484.096 5,572.096
212 Reinvestment Rate -14.27% -14.47% 3.44%
14 RoC 6.09% 8.15% 10.45%
Growth Rate

1,055.0
15.5%

116
787
28,591
19,694

128
7.04

5.39
5,709.096 5,880.096
8.64% 12.84%
13.32% 15.35%
1.97%
Revenue Projections: 2007 2008 2009 2010 2011
Service Revenue 4,194.3 4,781.5 5,379.2 5,917.2
Service Revenue Growth 14.0% 14.0% 12.5% 10.0%

Equipment Revenue 314.8 358.8 403.7 444.1


Equipment Revenue/Service Revenue (1) 7.5% 7.5% 7.5% 7.5%

Total Revenue 4509.10 5140.38 5782.93 6361.22

Operating Expenses:
System Operating Expenses 838.9 956.3 1,075.8 1,183.4
System Operating Exp./Service Revenue 20.0% 20.0% 20.0% 20.0%

Cost of Equipment Sold 755.5 861.2 968.9 1,065.8


Equipment COGS 240.0% 240.0% 240.0% 240.0%

Selling, General & Administrative 1,803.6 2,056.2 2,313.2 2,544.5


SG&A/Total Revenue 40.0% 40.0% 40.0% 40.0%

Depreciation & Amortization 705.2 804.0 867.4 922.4


15.64% 15.64% 15.00% 14.50%
Tax Rate 40.0% 40.0% 40.0% 40.0%

Total Expenses 3397.96 3873.68 4357.89 4793.68


EBIT 405.91 462.74 557.60 645.16
Synergy EBIT 156.48 282.00 413.16 622.49
Total EBIT(1-Tax Rate) 337 447 582 761
Working Capital Assumptions (1):
Accounts Receivable 41.67x 41.67x 41.67x 41.67x
435.5 521.90 594.96 669.33 736.26
Days Sales Equip. Rev. 154.36x 154.36x 154.36x 154.36x
101 134.97 153.86 173.10 190.41
Prepaid Expenses 1.38% 1.38% 1.38% 1.38%
42 46.91 53.48 60.17 66.19
Accounts Payable 35.54x 35.54x 35.54x 35.54x
261 335.42 382.38 430.18 473.20
Deferred Serv. Revenue 14.01x 14.01x 14.01x 14.01x
143 163.25 186.11 209.37 230.31
Accrued Liabilities 6.85x 6.85x 6.85x 6.85x
59 64.61 73.65 82.86 91.15

Working Capital 115 140 160 180 198


Change In Working Capital 26 20 20 18

Capital Expenditures (2):


Capital Expenditures 631.3 719.7 867.4 970.1
Cap-x/Total Revenue 14.0% 14.0% 15.0% 15.3%

Reinvestment (48) (65) 20 66


Free Cash Flow 386 511 562 695
Terminal Value
PV of FCF 356 472 442 505
NPV Of FCF 10,766

Interest Expense 199 183 166 148


Interest Tax Shield@5.5% 10.945 10.065 9.13 8.14
Terminal Value
PV Of Tax Shield 10.37 9.04 7.78 6.57
NPV 39.15

Total Firm Value 10,805.49


Long Term Debt 1002.3
Equity Value 9,803.19
2012
6,331.4
7.0%

475.2
7.5%

6806.50

1,266.3
20.0%

1,140.4
240.0%

2,722.6
40.0%

952.9
14.00%
40.0%

5129.23
724.36
780.43
903

41.67x
787.80
154.36x
203.73
1.38%
70.82
35.54x
506.32
14.01x
246.43
6.85x
97.53

212 Total Asset 5,611.9 5,545.096 5,484.096 5,572.096 5,709.096


14 Reinvestment Rate -14.27% -14.47% 3.44% 8.64%
RoC 6.09% 8.15% 10.45% 13.32%
Growth Rate
1,055.0
15.5%

116
787
12,626
8,991

128
7.04

5.39
5,880.096
12.84%
15.35%
1.97%
Revenue Projections: 2007 2008 2009 2010 2011
Service Revenue 4,194.3 4,781.5 5,379.2 5,917.2
Service Revenue Growth 14.0% 14.0% 12.5% 10.0%

Equipment Revenue 314.8 358.8 403.7 444.1


Equipment Revenue/Service Revenue (1) 7.5% 7.5% 7.5% 7.5%

Total Revenue 4509.10 5140.38 5782.93 6361.22

Operating Expenses:
System Operating Expenses 838.9 956.3 1,075.8 1,183.4
System Operating Exp./Service Revenue 20.0% 20.0% 20.0% 20.0%

Cost of Equipment Sold 755.5 861.2 968.9 1,065.8


Equipment COGS 240.0% 240.0% 240.0% 240.0%

Selling, General & Administrative 1,803.6 2,056.2 2,313.2 2,544.5


SG&A/Total Revenue 40.0% 40.0% 40.0% 40.0%

Depreciation & Amortization 705.2 804.0 867.4 922.4


15.64% 15.64% 15.00% 14.50%
Tax Rate 40.0% 40.0% 40.0% 40.0%

Total Expenses 3397.96 3873.68 4357.89 4793.68


EBIT 405.91 462.74 557.60 645.16
Synergy EBIT 0.00 0.00 0.00 0.00
Total EBIT(1-Tax Rate) 244 278 335 387
Working Capital Assumptions (1):
Accounts Receivable 41.67x 41.67x 41.67x 41.67x
435.5 521.90 594.96 669.33 736.26
Days Sales Equip. Rev. 154.36x 154.36x 154.36x 154.36x
101 134.97 153.86 173.10 190.41
Prepaid Expenses 1.38% 1.38% 1.38% 1.38%
42 46.91 53.48 60.17 66.19
Accounts Payable 35.54x 35.54x 35.54x 35.54x
261 335.42 382.38 430.18 473.20
Deferred Serv. Revenue 14.01x 14.01x 14.01x 14.01x
143 163.25 186.11 209.37 230.31
Accrued Liabilities 6.85x 6.85x 6.85x 6.85x
59 64.61 73.65 82.86 91.15

Working Capital 115 140 160 180 198


Change In Working Capital 26 20 20 18

Capital Expenditures (2):


Capital Expenditures 631.3 719.7 867.4 970.1
Cap-x/Total Revenue 14.0% 14.0% 15.0% 15.3%

Reinvestment (48) (65) 20 66


Free Cash Flow 292 342 315 321
Terminal Value
PV of FCF 269 316 247 233
NPV Of FCF 4,707

Interest Expense 199 183 166 148


Interest Tax Shield@5.5% 10.945 10.065 9.13 8.14
Terminal Value
PV Of Tax Shield 10.37 9.04 7.78 6.57
NPV 39.15

Total Firm Value 4,746.04


Long Term Debt 1002.3
Equity Value 3,743.74
2012
6,331.4
7.0%

475.2
7.5%

6806.50

1,266.3
20.0%

1,140.4
240.0%

2,722.6
40.0%

952.9
14.00%
40.0%

5129.23
724.36
0.00
435

41.67x
787.80
154.36x
203.73
1.38%
70.82
35.54x
506.32
14.01x
246.43
6.85x
97.53

212 Total Asset 5,611.9 5,545.096 5,484.096 5,572.096 5,709.096


14 Reinvestment Rate -19.78% -23.28% 5.98% 16.98%
RoC 4.39% 5.06% 6.00% 6.78%
Growth Rate
1,055.0
15.5%

116
319
5,113
3,641

128
7.04

5.39
5,880.096
26.68%
7.39%
1.97%
Equity Net Debt/ Debt/
Comparable Companies: EV Debt Market Value Debt Value Equity
Universal Mobile 187626.87 69130.00 118,497 69,130 36.8% 58.3%
Neuberger Wireless 268821.20 79351.25 189,470 79,351 29.5% 41.9%
Agile Connections 26158.88 5080.01 21,079 5,080 19.4% 24.1%
Big Country Communications 34620.44 8335.09 26,285 8,335 24.1% 31.7%
Rocky Mountain Wireless 10627.69 3267.80 7,360 3,268 30.7% 44.4%
Average 105,571 33,033 72,538 28.1% 40.1%
Equity Net
Beta Revenue EBIT EBITDA EV/Ebit Income P/E Unlevered Beta
0.86 43,882 11,795 16,949 16 3,794 31.23 0.64
0.89 42,684 7,020 14,099 38 4,103 46.18 0.71
1.17 34,698 1,631 9,914 16 (30) 1.02
0.97 38,896 6,702 12,614 5 3,384 7.77 0.81
1.13 4,064 510 1,028 21 240 30.70 0.89
1.00 19 28.97 0.82

Rf 4.25%
Rp 5%
Ba 0.82
Ka 8.33%
Assets: 2005 2006 2007 2008 2009 2010 2011
Cash & Cash Equivalents 29.0 32.9 204.5 87.0 14.0 0.0 0.0
Marketable Securities 0.0 249.0 16.4 16.0 16.0 16.0 16.0
Accounts Receivable 362.4 407.4 435.5 522.0 594.0 670.0 736.0
Inventory 92.7 117.2 101.0 135.0 154.0 173.0 190.0
Prepaid Expenses 32.1 35.0 41.6 47.0 53.0 60.0 66.0
Deferred Taxes 8.2 0.0 18.6 19.0 19.0 19.0 19.0
Other Current Assets 15.5 13.4 16.2 16.0 16.0 16.0 16.0
Total Current Assets 539.9 854.9 833.8 842.0 866.0 954.0 1,043.0

Property, Plan & Equipment 2,553.0 2,628.8 2,595.1 2,521.1 2,436.1 2,436.1 2,484.1
Licenses 1,362.3 1,494.3 1,482.4 1,482.0 1,482.0 1,482.0 1,482.0
Customer Lists 47.6 26.2 15.4 15.0 15.0 15.0 15.0
Marketable Equity Securities 225.4 4.9 0.0 0.0 0.0 0.0 0.0
Investments in Affiliated Entities 172.1 150.3 157.7 158.0 158.0 158.0 158.0
Long Term Note Receivable 4.7 4.5 4.4 4.0 4.0 4.0 4.0
Goodwill 481.2 485.5 491.3 491.0 491.0 491.0 491.0
Other Long Term Assets 30.0 31.1 31.8 32.0 32.0 32.0 32.0
Total Assets 5,416.2 5,680.6 5,611.9 5,545.096 5,484.096 5,572.096 5,709.096
2012
0.0
16.0
787.0
203.0
70.0
19.0
16.0
1,111.0

2,587.1
1,482.0
15.0
0.0
158.0
4.0
491.0
32.0
5,880.096
Wireless Business Subscribers: 2008 2009 2010 2011 2012
Average Monthly Subscribers (in MM's) 0.3 0.5 0.7 1 1.2
Average Monthly Minutes 859 884.77 911.3131 938.6525 966.8121
Total Monthly Minutes 257.7 442.385 637.9192 938.6525 1160.174
Revenue Per Minute 0.0506 0.0506 0.0506 0.0506 0.0506
Annual Business Revenue Increase 156.4754 268.6162 387.3445 569.9498 704.4579

Backhaul Savings: 2008 2009 2010 2011 2012


System Operating Expenses 838.866 956.3073 1075.846 1183.43 1266.27
Backhaul Percentage 0.2 0.2 0.2 0.2 0.2
Estimated Backhaul Costs 167.7732 191.2615 215.1691 236.6861 253.2541
Reduction in Backhaul Costs 0% 7% 12% 22% 30%
Backhaul Savings 0 13.3883 25.8203 52.5443 75.97622

Net Ebit Added Because of Synergy 156.4754 282.0045 413.1648 622.4941 780.4342
Base Case Scenario
Equity Value using APV 3808.01
Equity Value using APV -
Terminal Value using
market Miltiple 9606.693
With Synergy
Equity Value using APV 9867.465
Equity Value using APV -
Terminal Value using
market Miltiple 20569.81

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