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SIMPLIFIED CFROI VALUATION MODEL AUDIT
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-----START UP-----BIG "T"---STOP INVESTING---
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10%
COST OF CAPITAL
12345678910
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(A)
Growth Rate
10.0%10.0%10.0%8.5%7.5%6.0%
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(B)
Project ROI
20.0%20.0%20.0%20.0%17.0%15.0%12.0%
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Project Cash Flows
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142.0 42.0 42.0
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246.2 46.2 46.2
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350.8 50.8 50.8
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455.9 55.9 55.9
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557.2 57.2 57.2
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659.1 59.1 59.1
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758.8 58.8 58.8
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(C)
Gross Cash Flow
0.0 42.0 88.2 138.9 152.8 163.9 172.1 175.0 117.8 58.8
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(D)
Investment NWC
20.0 22.0 24.2 26.6 28.9 31.0 32.9 0.0 0.0 0.0
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(E)
Released NWC
20.0 22.0 24.2 26.6 28.9 31.0 32.9
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(F)
Net Change NWC (D - E)
20.0 22.0 24.2 6.6 6.9 6.8 6.3 (28.9)(31.0)(32.9)
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(G)
CAPEX
80.0 88.0 96.8 106.5 115.5 124.2 131.6 0.0 0.0 0.0
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(H)
NCR (C - F - G)
(100.0)(68.0)(32.8)25.8 30.4 32.8 34.2 203.9 148.9 91.7
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(I)
Balance Sheet - NWC
20.0 42.0 66.2 72.8 79.7 86.6 92.8 64.0 32.9 0.0
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(J)
Balance Sheet - Gross Assets
100.0 210.0 331.0 364.1 398.5 432.8 464.2 319.8 164.6 0.0
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(K)
% Non-Depreciating
20.0%20.0%20.0%20.0%20.0%20.0%20.0%20.0%20.0%
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(L)
CFROI
20.0%20.0%20.0%20.0%18.9%17.2%14.6%13.5%12.0%
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Gross CF(t) & Gross Assets(t-1)
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VALUE #1
354.3 363.9 369.9 374.0 377.3 211.1 83.3 0.0
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= PV NCR(t+1) to YR 10 [H]
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EXISTING ASSETS
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(M)
PV This Year of Cash Flow / Wind Down
244.6 269.1 285.4 296.9 300.6 155.7 53.4 0.0
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(N)
PV Released NWC
54.5 60.0 65.7 71.4 76.6 55.4 29.9 0.0
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(O)
PV of Total Receipts From Existing Assets (M + N)
299.2 329.1 351.1 368.3 377.3 211.1 83.3 0.0
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FUTURE INVESTMENTS
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(P)
Investment (D + G)
121.0 133.1 144.4 155.2 164.6 0.0 0.0 0.0
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(Q)
PV of Investment
144.5 158.9 163.9 170.2 170.9 0.0 0.0 0.0
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(R)
Incremental Wealth Created (P - Q)
23.5 25.8 19.5 14.9 6.3 0.0 0.0 0.0
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(S)
PV Incremental Wealth Stream
55.2 34.8 18.8 5.7 0.0 0.0 0.0 0.0
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VALUE #2
354.3 363.9 369.9 374.0 377.3 211.1 83.3 0.0
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= (O + S)
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(T)
Shareholder Return
10.0%10.0%10.0%10.0%10.0%10.0%10.0%
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((Value(t) + NCR(t) ) / Value(t-1)) - 1
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(U)
% Future
9.6%5.1%1.5%0.0%0.0%0.0%
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( S / Value(t) )
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