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This is a Leverage Buyout Model Template built in Excel.

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Flevy.com - LBO Model Template Flevy.com - LBO Model Template Presentation Transcript

  • Project NameLBO Transaction Summary($ in millions, except per share data)Transaction Assumptions Sources & Uses of FundsTransaction Date December 2008 Sources Amount Percent Rate Term FeesMonths to End of Year 12 Existing Cash $32.5 22.9%Minimum Operating Cash $5.0 Line of Credit* 0.0 0.0% 5.6% 5 years 1.5%12 Month LIBOR 2.80% Senior Debt - Term A 34.8 24.5% 8.3% 5 years 1.5% Senior Debt - Term B 0.0 0.0% 9.3% 8 years 1.5%Trading Information Sub Debt 0.0 0.0% 11.8% 10 years 2.0% Deal Current Rollover Debt 0.0 0.0% 0.0% 0 years 0.0%Share Price $10.00 $2.03 Equity 74.5 52.6% 1.0%Diluted Shares 13.3 13.2 Total Sources $141.8 100.0% Equity Market Value $132.9 $26.9 *Available Line of CreditPlus: Debt Outstanding 4.7 4.7 Uses $17.5Less: Cash & Equivalents 37.5 37.5 Purchase of Equity $132.9 93.7% Enterprise Value $100.1 ($5.9) Debt Repayment 4.7 3.3% Working Capital 0.0 0.0%2008P EBITDA Multiple 5.8x -0.3x Financing Fees 1.5 1.1% Transaction Expenses 2.7 1.9% 2.0%Debt Capacity Analysis Total Uses $141.8 100.0%2008P EBITDA $17.4Senior Debt / EBITDA Coverage 2.0x Equity IRR Calculation Senior Debt Capacity $34.8 Exit LTM EBITDA Multiple 2011 Exit 2012 Exit 2013 ExitSub Debt / EBITDA Coverage 0.0x 5.0x 8.7% 12.5% 14.5% Sub Debt Capacity $0.0 6.0x 16.1% 17.7% 18.3% 7.0x 22.6% 22.2% 21.7%Goodwill Calculation 8.0x 28.5% 26.3% 24.7%Purchase Price of Equity $132.9Plus: Transaction Costs 4.2 Credit StatisticsLess: Book Value of Equity 90.0 2008PF 2009P 2010P Total Deal Goodwill $47.1 EBITDA / Interest Exp. 6.6x 8.0x 9.0x EBITDA - CapEx / Interest Exp. 2.6x 4.4x 5.4x% of Goodwill Allocated to Intangibles 20.0% Total Debt / EBITDA 2.0x 1.7x 1.1x Amount Allocated to Intangibles $9.4 EBITDAR / Adj. Interest Exp. 3.6x 3.7x 3.9xAmortization Period 7 years EBITDAR - CapEx / Adj. Interest Exp. 2.9x 3.2x 3.3x Annual Amortization of Intangibles $1.3 Adj. Total Debt / EBITDAR 6.0x 6.0x 5.7xAmount Allocated to Goodwill $37.7 Cumulative Senior 2009P 2010P 2011P 2012P 2013P Debt Paydown 20.0% 40.0% 62.4% 93.2% 100.0%
  • Project NameReturns Analysis($ in millions, except per share data)2011 Exit Analysis Sensitivity Analysis - 2011 ExitYears to Exit 3.0 Price LTM EBITDA Exit Multiple PremiumExit EBITDA Multiple 5.0x 6.0x 7.0x 8.0x 8.7% 5.0x 6.0x 7.0xExit LTM EBITDA 20.6 20.6 20.6 20.6 $8.00 8.7% 8.7% 8.7% 294.1% Implied Enterprise Value $103.0 $123.6 $144.2 $164.7 $9.00 8.7% 8.7% 8.7% 343.3% $10.00 8.7% 8.7% 8.7% 392.6%Less: Debt Outstanding 13.1 13.1 13.1 13.1 $11.00 8.7% 8.7% 8.7% 441.9%Plus: Cash & Equivalents 5.0 5.0 5.0 5.0 $12.00 8.7% 8.7% 8.7% 491.1% Implied Equity Value $94.9 $115.5 $136.1 $156.7Implied IRR 8.7% 16.1% 22.6% 28.5%Implied Return Multiple 1.3x 1.5x 1.8x 2.1x2012 Exit Analysis Sensitivity Analysis - 2012 ExitYears to Exit 4.0 Price LTM EBITDA Exit Multiple PremiumExit EBITDA Multiple 5.0x 6.0x 7.0x 8.0x 12.5% 5.0x 6.0x 7.0xExit LTM EBITDA 23.1 23.1 23.1 23.1 $8.00 12.5% 12.5% 12.5% 294.1% Implied Enterprise Value $115.7 $138.9 $162.0 $185.2 $9.00 12.5% 12.5% 12.5% 343.3% $10.00 12.5% 12.5% 12.5% 392.6%Less: Debt Outstanding 2.3 2.3 2.3 2.3 $11.00 12.5% 12.5% 12.5% 441.9%Plus: Cash & Equivalents 5.0 5.0 5.0 5.0 $12.00 12.5% 12.5% 12.5% 491.1% Implied Equity Value $118.4 $141.5 $164.7 $187.8Implied IRR 12.5% 17.7% 22.2% 26.3%Implied Return Multiple 1.6x 1.9x 2.2x 2.5x2013 Exit Analysis Sensitivity Analysis - 2013 ExitYears to Exit 5.0 Price LTM EBITDA Exit Multiple PremiumExit EBITDA Multiple 5.0x 6.0x 7.0x 8.0x 14.5% 5.0x 6.0x 7.0xExit LTM EBITDA 25.9 25.9 25.9 25.9 $8.00 14.5% 14.5% 14.5% 294.1% Implied Enterprise Value $129.6 $155.5 $181.4 $207.3 $9.00 14.5% 14.5% 14.5% 343.3% $10.00 14.5% 14.5% 14.5% 392.6%Less: Debt Outstanding 0.0 0.0 0.0 0.0 $11.00 14.5% 14.5% 14.5% 441.9%Plus: Cash & Equivalents 15.6 15.6 15.6 15.6 $12.00 14.5% 14.5% 14.5% 491.1% Implied Equity Value $145.2 $171.1 $197.0 $222.9Implied IRR 14.5% 18.3% 21.7% 24.7%Implied Return Multiple 1.9x 2.3x 2.6x 3.0x
  • Project NameSummary Financials and Credit Analysis($ in millions, except per share data) FY December 31, 2008PF 2009P 2010P 2011P 2012P 2013PUnadjusted Operating StatisticsRevenue $274.0 $271.5 $276.9 $290.8 $305.3 $320.6EBITDA 17.4 16.5 18.2 20.6 23.1 25.9EBIT 5.4 3.2 4.5 6.1 7.7 9.5Capital Expenditures 10.5 7.4 7.3 8.9 9.1 9.3Interest Expense 2.6 2.1 2.0 1.4 0.6 0.1Total Debt 34.8 27.8 20.9 13.1 2.3 0.0Total Capitalization 109.3 102.7 97.3 92.5 86.2 89.8Unadjusted Credit StatisticsEBITDA / Interest Expense 6.6x 8.0x 9.0x 14.6x 36.2x 265.7xEBITDA - CapEx / Interest Expense 2.6x 4.4x 5.4x 0.5x 3.3x N.A.Total Debt / EBITDA 2.0x 1.7x 1.1x 0.6x 0.1x 0.0xTotal Debt / Total Capitalization 31.8% 27.1% 21.4% 14.1% 2.7% 0.0%Cumulative Senior Debt Paydown 20.0% 40.0% 62.4% 93.2% 100.0%Adjusted Operating StatisticsEBITDAR $53.3 $52.1 $54.5 $58.7 $63.2 $67.9Adjusted Interest Expense 14.6 13.9 14.1 14.1 14.0 14.1Adjusted Total Debt 322.1 312.5 311.2 317.9 322.5 336.1Adjusted Total Capitalization 396.6 387.4 387.7 397.4 406.3 425.9Adjusted Credit StatisticsEBITDAR / Adj. Interest Exp. 3.6x 3.7x 3.9x 4.2x 4.5x 4.8xEBITDAR - CapEx / Adj. Interest Exp. 2.9x 3.2x 3.3x 3.5x 3.9x 4.2xAdj. Total Debt / EBITDAR 6.0x 6.0x 5.7x 5.4x 5.1x 4.9xAdj. Total Debt / Adj. Total Cap. 81.2% 80.7% 80.3% 80.0% 79.4% 78.9%Adjustment CalculationsRent Expense $35.9 $35.6 $36.3 $38.1 $40.0 $42.0Rent Factor 8.0x 8.0x 8.0x 8.0x 8.0x 8.0x Adjustment to Total Debt $287.3 $284.7 $290.4 $304.9 $320.1 $336.1Expense Attributable to Interest 33.3% 33.3% 33.3% 33.3% 33.3% 33.3% Adjustment to Interest Expense $12.0 $11.9 $12.1 $12.7 $13.3 $14.0
  • Project NameOperating Assumptions($ in millions, except per share data) FY December 31, FY December 31, 2006A 2007A 2008P 2009P 2010P 2011P 2012P 2013PIncome StatementRevenue Growth 0.0% 3.2% (0.1%) (0.9%) 2.0% 5.0% 5.0% 5.0%EBITDA Growth (12.2%) (40.0%) (14.7%) (5.0%) 10.4% 13.0% 12.4% 11.9%Net Income Growth (13.6%) (53.7%) (47.9%) (90.0%) 324.5% 86.8% 51.7% 34.1%COGS (% of Revenue) 50.5% 53.7% 55.5% 56.0% 56.0% 56.0% 56.0% 56.0%SG&A (% of Revenue) 23.2% 25.7% 25.0% 24.8% 24.3% 23.8% 23.3% 22.8%Rent Expense (% of Revenue) 13.5% 13.1% 13.1% 13.1% 13.1% 13.1% 13.1% 13.1%Interest Income (% of Cash) 4.9% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6%Other Income (% of Revenue) 0.0% (0.1%) (0.1%) 0.0% 0.0% 0.0% 0.0% 0.0%Effective Tax Rate 39.0% 34.6% 36.6% 37.5% 37.5% 37.5% 37.5% 37.5%Gross Margin 49.5% 46.3% 44.5% 44.0% 44.0% 44.0% 44.0% 44.0%EBITDA Margin 12.8% 7.4% 6.3% 6.1% 6.6% 7.1% 7.6% 8.1%Net Income Margin 5.8% 2.6% 1.3% 0.1% 0.6% 1.0% 1.5% 1.9%Balance SheetAccounts Receivable Days 6.4 6.4 6.6 6.6 6.6 6.6 6.6Inventory Turnover 4.5x 5.5x 5.5x 5.5x 5.5x 5.5x 5.5xPrepaid Expenses (% of Revenue) 2.7% 0.9% 2.0% 2.2% 2.2% 2.2% 2.2% 2.2%Other Current Assets (% of Revenue) 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%Other Assets (% of Revenue) 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1%Accounts Payable Days 28.3 21.8 20.9 20.9 20.9 20.9 20.9Accrued Expenses (% of Revenues) 0.6% 0.7% 1.0% 0.9% 0.9% 0.9% 0.9% 0.9%Other Current Liabilities (% of Revenue) 4.3% 5.2% 3.8% 3.8% 3.8% 3.8% 3.8% 3.8%Other Liabilities (% of Revenue) 6.7% 5.9% 6.0% 6.2% 6.2% 6.2% 6.2% 6.2%Store BuildoutBeginning Number of Stores 306 296 297 295 292 297 307 317New Stores 17 10 14 5 5 10 10 10Closed Stores 27 9 16 8 0 0 0 0Stores Opened, net (10) 1 (2) (3) 5 10 10 10Ending Number of Stores 296 297 295 292 297 307 317 327Net Store Growth -3.3% 0.3% -0.7% -1.0% 1.7% 3.4% 3.3% 3.2%New Store Capex $5.1 $3.0 $4.2 $1.5 $1.5 $3.0 $3.0 $3.0Capex per New Store $0.3 $0.3 $0.3 $0.3 $0.3 $0.3 $0.3 $0.3Maintenance Capex $7.2 $9.1 $6.3 $5.9 $5.8 $5.9 $6.1 $6.3Maintenance Capex, per Existing Store $0.02 $0.03 $0.02 $0.02 $0.02 $0.02 $0.02 $0.02Total Capex $12.3 $12.1 $10.5 $7.4 $7.3 $8.9 $9.1 $9.3
  • Project NameActual & Projected Income Statement($ in millions, except per share data) FY December 31, FY December 31, 2006A 2007A 2008P 2009P 2010P 2011P 2012P 2013PRevenue $265.9 $274.5 $274.0 $271.5 $276.9 $290.8 $305.3 $320.6COGS 134.2 147.5 152.2 152.1 155.2 162.9 171.1 179.6 Gross Profit 131.7 127.0 121.9 119.4 121.8 127.9 134.3 141.0SG&A 61.8 70.7 68.6 67.3 67.3 69.2 71.1 73.1 EBITDAR $69.9 $56.3 $53.3 $52.1 $54.5 $58.7 $63.2 $67.9Rent Expense 36.0 36.0 35.9 35.6 36.3 38.1 40.0 42.0 EBITDA $33.9 $20.4 $17.4 $16.5 $18.2 $20.6 $23.1 $25.9Depreciation of Existing Assets 11.4 12.1 12.0 12.0 12.0 12.0 12.0 12.0Depreciation of New CapEx 0.0 0.0 0.0 0.0 0.4 1.2 2.1 3.0Amortization of Intangibles 0.0 0.0 0.0 1.3 1.3 1.3 1.3 1.3 Total D&A 11.4 12.1 12.0 13.3 13.7 14.5 15.4 16.4 EBIT $22.6 $8.2 $5.4 $3.2 $4.5 $6.1 $7.7 $9.5Other Income 0.0 0.2 0.3 0.0 0.0 0.0 0.0 0.0Interest Income (2.5) (2.8) (0.7) (0.1) (0.1) (0.1) (0.1) (0.2)Unused Credit Line Fee 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Existing Debt Interest Expense 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Line of Credit Interest Expense 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Senior Debt - Term A Interest Expense 0.0 0.0 0.0 2.6 2.0 1.4 0.6 0.1Senior Debt - Term B Interest Expense 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Sub Debt Interest Expense 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Total Other Expense (2.5) (2.6) (0.4) 2.6 2.0 1.4 0.6 (0.0) Pretax Income 25.1 10.8 5.8 0.6 2.5 4.7 7.1 9.5Income Taxes 9.8 3.7 2.1 0.2 0.9 1.8 2.7 3.6 Net Income $15.3 $7.1 $3.7 $0.4 $1.6 $2.9 $4.4 $6.0
  • Project NameActual & Projected Balance Sheet($ in millions, except per share data) FY December 31, Current FY December 31, 2006A 2007A 2008P Adjust. 2008PF 2009P 2010P 2011P 2012P 2013PAssetsCash & Equivalents $61.5 $50.1 $37.5 ($32.5) $5.0 $3.0 $4.3 $5.0 $5.0 $15.6Accounts Receivable 4.8 4.8 4.8 4.8 5.0 5.0 5.3 5.5 5.8Inventory 34.8 30.5 25.0 25.0 30.0 28.1 29.5 30.9 32.5Prepaid Expenses 7.2 2.5 5.6 5.6 6.0 6.1 6.4 6.7 7.1Other Current Assets 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Total Current Assets 108.3 87.9 73.0 (32.5) 40.5 44.0 43.5 46.2 48.2 61.0Net PP&E 50.5 49.3 46.4 46.4 41.8 36.8 32.5 27.6 21.9Existing Goodwill & Intangibles 0.1 11.5 11.4 11.4 11.4 11.4 11.4 11.4 11.4Acquisition Goodwill 0.0 0.0 0.0 37.7 37.7 37.7 37.7 37.7 37.7 37.7Acquisition Intangibles 0.0 0.0 0.0 9.4 9.4 8.1 6.7 5.4 4.0 2.7Other Assets 0.3 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.5 Total Assets $159.2 $149.1 $131.2 $14.6 $145.8 $143.4 $136.5 $133.6 $129.4 $135.2Liabilities & Shareholders EquityAccounts Payable $11.7 $10.5 $7.0 $7.0 $11.0 $8.9 $9.3 $9.8 $10.3Accrued Expenses 1.7 1.9 2.7 2.7 2.5 2.6 2.7 2.8 3.0Other Current Liabilities 11.5 14.3 10.4 10.4 10.4 10.6 11.1 11.7 12.2 Total Current Liabilities 24.9 26.7 20.0 0.0 20.0 23.9 22.0 23.1 24.3 25.5Other Liabilities 17.8 16.3 16.5 16.5 16.8 17.2 18.0 18.9 19.9Existing Debt 0.0 5.9 4.7 (4.7) 0.0 0.0 0.0 0.0 0.0 0.0New Line of Credit 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0New Senior Debt - Term A 0.0 0.0 0.0 34.8 34.8 27.8 20.9 13.1 2.3 0.0New Senior Debt - Term B 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0New Sub Debt 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Accumulated PIK Interest 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Total Liabilities 42.7 48.9 41.2 30.1 71.3 68.5 60.0 54.2 45.6 45.4Existing Shareholders Equity 116.5 100.3 90.0 (90.0) 0.0 0.0 0.0 0.0 0.0 0.0New Common Stock 0.0 0.0 0.0 74.5 74.5 74.5 74.5 74.5 74.5 74.5New Retained Earnings 0.0 0.0 0.0 0.0 0.0 0.4 1.9 4.9 9.3 15.3 Total Shareholders Equity 116.5 100.3 90.0 (15.4) 74.5 74.9 76.5 79.4 83.9 89.8 Total Liabilities & Shlds. Equity $159.2 $149.1 $131.2 $14.6 $145.8 $143.4 $136.5 $133.6 $129.4 $135.2
  • Project NameProjected Cash Flow Statement($ in millions, except per share data) FY December 31, 2009P 2010P 2011P 2012P 2013PNet Income $0.4 $1.6 $2.9 $4.4 $6.0Depreciation on Existing Assets 12.0 12.0 12.0 12.0 12.0Depreciation on New CapEx 0.0 0.4 1.2 2.1 3.0Amortization of Intangibles 1.3 1.3 1.3 1.3 1.3Change in Accounts Receivable (0.2) (0.0) (0.3) (0.3) (0.3)Change in Inventory (5.0) 2.0 (1.4) (1.5) (1.5)Change in Prepaid Expenses (0.4) (0.1) (0.3) (0.3) (0.3)Change in Other Assets (0.0) (0.0) (0.0) (0.0) (0.0)Change in Accounts Payable 4.0 (2.1) 0.4 0.5 0.5Change in Accrued Expenses (0.2) 0.0 0.1 0.1 0.1Change in Other Liabilities 0.4 0.5 1.4 1.5 1.5 Cash Flow from Operations $12.4 $15.6 $17.4 $19.9 $22.3Capital Expenditures ($7.4) ($7.3) ($8.9) ($9.1) ($9.3) Cash Flow from Investing ($7.4) ($7.3) ($8.9) ($9.1) ($9.3)Repayments of Line of Credit $0.0 $0.0 $0.0 $0.0 $0.0Repayments of Senior Debt - Term A (7.0) (7.0) (7.8) (10.7) (2.3)Repayments of Senior Debt - Term B 0.0 0.0 0.0 0.0 0.0Repayments of Sub Debt 0.0 0.0 0.0 0.0 0.0Additions to PIK Interest 0.0 0.0 0.0 0.0 0.0 Cash Flow from Financing ($7.0) ($7.0) ($7.8) ($10.7) ($2.3)Net Cash Flow ($2.0) $1.3 $0.7 ($0.0) $10.6 Beginning Cash & Equivalents 5.0 3.0 4.3 5.0 5.0Ending Cash & Equivalents $3.0 $4.3 $5.0 $5.0 $15.6
  • Project NameProjected Debt Schedule($ in millions, except per share data) FY December 31, 2009P 2010P 2011P 2012P 2013P 12 Month LIBOR 2.80%Cash Flow Available to Repay Debt $10.0 $11.2 $12.8 $15.7 $18.0Minimum Cash Balance 5.0 5.0 5.0 5.0 5.0 Net Cash Available $5.0 $6.2 $7.8 $10.7 $13.0 TermsLine of Credit Availability $17.5Beginning Balance $0.0 $0.0 $0.0 $0.0 $0.0 Unused Fee 0.25%Borrowings / (Repayment) 0.0 0.0 0.0 0.0 0.0 Spread 2.8%Ending Balance 0.0 0.0 0.0 0.0 0.0 Total Rate 5.6%Interest Expense 0.0 0.0 0.0 0.0 0.0 Term 5 yearsUnused Credit Line Fee $0.0 $0.0 $0.0 $0.0 $0.0 Type BulletSenior Debt - Term A TermsBeginning Balance $34.8 $27.8 $20.9 $13.1 $2.3 Spread 5.5%Mandatory Amortization 20.0% 20.0% 20.0% 20.0% 20.0% Total Rate 8.3%Mandatory Repayment (7.0) (7.0) (7.0) (7.0) (2.3) Term 5 yearsAdditional Repayment 0.0 0.0 (0.8) (3.8) 0.0 Type AmortizeEnding Balance 27.8 20.9 13.1 2.3 0.0Net Cash Available (2.0) (0.7) 0.0 0.0 10.6Interest Expense $2.6 $2.0 $1.4 $0.6 $0.1Senior Debt - Term B TermsBeginning Balance $0.0 $0.0 $0.0 $0.0 $0.0 Spread 6.5%Mandatory Amortization 0.0% 0.0% 0.0% 0.0% 0.0% Total Rate 9.3%Mandatory Repayment 0.0 0.0 0.0 0.0 0.0 Term 8 yearsAdditional Repayment 0.0 0.0 0.0 0.0 0.0 Type BulletEnding Balance 0.0 0.0 0.0 0.0 0.0Net Cash Available (2.0) (0.7) 0.0 0.0 10.6Interest Expense $0.0 $0.0 $0.0 $0.0 $0.0Sub Debt TermsBeginning Balance $0.0 $0.0 $0.0 $0.0 $0.0 Spread 9.0%Additional Repayment 0.0 0.0 0.0 0.0 0.0 Total Rate 11.8%Ending Balance 0.0 0.0 0.0 0.0 0.0 PIK Interest 0.0%Interest Expense 0.0 0.0 0.0 0.0 0.0 Term 10 yearsPIK Interest Expense $0.0 $0.0 $0.0 $0.0 $0.0 Type BulletTotal Cumulative Interest Expense $2.6 $4.6 $6.0 $6.7 $6.8Cumulative Senior Debt Paydown 20.0% 40.0% 62.4% 93.2% 100.0%