Assumptions for Forecasting Model

Income Statement
Sales
Cost of Sales
Selling, General & Admn. Expenses
Depreciation
Other Operating Income
Interest Income
Interest Expense
Income Taxes
Balance Sheet
Assets
Cash and Marketable Securities
Accounts Receivable
Inventories
Other Current Assets
Gross Fixed Assets
Accumulated Depreciation
Net Fixed Assets
Other Non-Current Assets
Liabilities and Shareholders' Equity
Accounts Payable
Short-Term Debt
Other Current Liabilities
Long-Term Debt
Deferred Income Taxes
Other Non-Current Liabilities
Paid-In Capital
Retained Earnings
Other Assumptions
Dividend payout ratio
Interest on short-term debt
Interest on long-term debt
Interest on cash & marketable securities
Number of shares outstanding
P/E ratio

Assumption
Will grow at 5%, based on input from management

5%

52% of sales, little better than historical average

50%

29% of sales, based on expected worsening

29%

8% of closing Gross Fixed Assets(current year), based on analysis of depreciation schedules

0.7% of sales, based on historical average

8%
0.7%

Calculate based on interest rate specified later

For STD calculate based on average balance and interest rate
For LTD interest expense will remain unchanged at $ 13.5 million

13.5

35% of pre-tax income

35%

2.1%, of sales based on historical average

2.10%

8.4% of sales, based on historical average

8.40%

8.8% of sales, based on historical average

8.80%

7.6% of sales, based on historical average

7.60%

Will grow at 11% per year, based on discussion with management

8%

Calculated from other items

Calculated from other items
Will grow at 10% per year, based on discussion with management

6.1% of sales, same as historical average

8%

6.10%

Read Handout
8.3% of sales, same as 2013

8.30%

Read Handout
1.4% of sales, based on historical average

1.40%

7.6% of sales, based on historical average

7.60%

Will remain unchanged

Calculated from other items

40%, based on discussion with management

7%, based on economic forecast (7% of the average short-term debt)
Rates embedded in existing debt, annual expense $13.5 million
6%, based on economic forecast (6% of previous year's cash balance)
Will remain unchanged
Will decline to 16 in 2014 and then improve to 18, 20, 22 and 23 in the following years

40%
7%
13.5
6%

Income Statement and Balance Sheet for OLP Limited

Income Statement ($ Million)
in $ Millions, excepting per share data

Sales
Cost of Sales
Other Operating Income
Gross Operating Income

2010A
1234.9
679.1
11.8
567.6

Actuals
2011A
1251.7
659
7.6
600.3

2012A
1300.4
681.3
7
626.1

2013A
1334.40
667.00
8.20
675.60

2014E
1401.12
700.56
9.81
710.37

Projected Figures
2015E
2016E
2017E
1471.18 1544.73 1621.97
735.59
772.37
810.99
10.30
10.81
11.35
745.89
783.18
822.34

2018E
1703.07
851.54
11.92
863.46

Selling, General & Admn. Expenses

Depreciation
EBIT

339.7
47.5
180.4

348.6
52
199.7

351.2
55.9
219

373.30
75.20
227.10

406.32
78.89
225.15

426.64
85.20
234.04

447.97
92.02
243.19

470.37
99.38
252.59

493.89
107.33
262.23

Interest Income
Interest Expense
Pre-Tax Income

1.3
16.2
165.5

1.4
15.1
186

1.7
20.5
200.2

2.00
23.70
205.40

1.70
21.22
205.63

5.62
21.22
218.44

8.69
21.22
230.66

11.88
21.22
243.24

15.19
21.22
256.20

Income Taxes
Net Income

56.8
108.7

64.2
121.8

67.5
132.7

72.60
132.80

71.97
133.66

76.46
141.99

80.73
149.93

85.14
158.11

89.67
166.53

38.3
70.4

38.7
83.1

39.8
92.9

40.10
92.70

53.46
80.20

56.80
85.19

59.97
89.96

63.24
94.87

66.61
99.92

Assets
Cash and Marketable Securities
Accounts Receivable
Inventories
Other Current Assets
Total Current Assets

25.6
99.4
109.6
96.7
331.3

23
102.9
108
91.4
325.3

32.1
107.3
114.9
103.7
358

28.40
120.10
116.80
97.50
362.80

93.72
93.72
117.69
123.30
106.49
441.20

144.82
144.82
123.58
129.46
111.81
509.67

197.99
197.99
129.76
135.94
117.40
581.08

253.15
253.15
136.25
142.73
123.27
655.40

310.22
310.22
143.06
149.87
129.43
732.58

Gross Fixed Assets

Accumulated Depreciation
Net Fixed Assets

680.9
244.8
436.1

734.3
296.8
437.5

820.8
352.7
468.1

913.10
427.90
485.20

986.15
506.79
479.36

1065.04
592.00
473.04

1150.24
684.01
466.23

1242.26
783.40
458.87

1341.64
890.73
450.92

Other Non-Current Assets

Total Non-Current Assets

203.2
639.3

205.1
642.6

407
875.1

456.30
941.50

492.80
972.16

532.23
1005.27

574.81
1041.04

620.79
1079.66

670.45
1121.37

970.6

967.9

1233.1

1304.30

1413.36

1514.95

1622.11

1735.05

1853.95

Liabilities and Shareholders' Equity

Accounts Payable
Short-Term Debt
Other Current Liabilities
Total Current Liabilities

82.8
39.1
152
273.9

77.1
29.7
123.8
230.6

71.8
79.8
172.1
323.7

80.50
110.30
111.30
302.10

85.47
110.30
116.29
312.06

89.74
110.30
122.11
322.15

94.23
110.30
128.21
332.74

98.94
110.30
134.62
343.86

103.89
110.30
141.35
355.54

Long-Term Debt
Deferred Income Taxes
Other Non-Current Liabilities
Total Liabilities

163.5
22.3
100.6
560.3

145
19.6
80.1
475.3

201.8
15
115
655.5

218.10
12.70
94.50
627.40

218.10
19.62
106.49
656.26

218.10
20.60
111.81
672.66

218.10
21.63
117.40
689.87

218.10
22.71
123.27
707.94

218.10
23.84
129.43
726.92

Share Capital
Retained Earnings
Total Shareholders' Equity

46.9
363.4
410.3

46.1
446.5
492.6

38.2
539.4
577.6

44.80
632.10
676.90

44.80
712.30
757.10

44.80
797.49
842.29

44.80
887.45
932.25

44.80
982.31
1027.11

44.80
1082.23
1127.03

970.6

967.9

1233.1

1304.30

1413.36

1514.95

1622.11

1735.05

1853.95

Ok

Ok

Ok

OK

OK

OK

OK

OK

OK

Dividends
Addition to Retained Earnings

Balance Sheet ($ Million)

Total Assets

Total Liabilities and Shareholders' Equity

Discretionary Funding Need (DFN)

Statement of Cash Flows for OLP Limited

Millions of $
Actuals
2011A

2012A

Cash Flows from Operations

Net Income
Depreciation Expense
Decrease/(Increase) in Accounts Receivable
Decrease/(Increase) in Inventories
Decrease/(Increase) in Other Current Assets
Increase/(Decrease) in Accounts Payable
Increase/(Decrease) in Other Current Liabilities
Increase/(Decrease) in Deferred Income Taxes
Increase/(Decrease) in Other Non-Current Liabilities
Total Cash Flows from Operations

121.80
52.00
-3.50
1.60
5.30
-5.70
-28.20
-2.70
-20.50
120.10

132.70
55.90
-4.40
-6.90
-12.30
-5.30
48.30
-4.60
34.90
238.30

Cash Flows from Investing

(Additions to) Gross Fixed Assets
(Investment) in Other Non-Current Assets
Total Cash Flows from Investing

-53.40
-1.90
-55.30

-86.50
-201.90
-288.40

Cash Flows from Financing

From Issuance/(Repayment) of Short-Term Debt
From Issuance/(Repayment) of Long-Term Debt
From Sale/(Repurchase) of Equity
Cash Dividends Paid to Shareholders
Total Cash Flows from Financing

-9.40
-18.50
-0.80
-38.70
-67.40

50.10
56.80
-7.90
-39.80
59.20

Net Change in Cash & Marketable Securities

-2.60

9.10

25.60
23.00

23.00
32.10

in $ Millions, excepting per share data

Beginning Cash & Marketable Securities

Ending Cash & Marketable Securities

2010A

s
2013A

2014E

Projected Figures
2015E
2016E
2017E

2018E

132.80
75.20
-12.80
-1.90
6.20
8.70
-60.80
-2.30
-20.50
124.60

133.66
78.89
2.41
-6.50
-8.99
4.97
4.99
6.92
11.99
228.34

141.99
85.20
-5.88
-6.16
-5.32
4.27
5.81
0.98
5.32
226.21

149.93
92.02
-6.18
-6.47
-5.59
4.49
6.11
1.03
5.59
240.92

158.11
99.38
-6.49
-6.80
-5.87
4.71
6.41
1.08
5.87
256.41

166.53
107.33
-6.81
-7.14
-6.16
4.95
6.73
1.14
6.16
272.73

-92.30
-49.30
-141.60

-73.05
-36.50
-109.55

-78.89
-39.42
-118.32

-85.20
-42.58
-127.78

-92.02
-45.98
-138.00

-99.38
-49.66
-149.04

30.50
16.30
6.60
-40.10
13.30

0.00
0.00
0.00
-53.46
-53.46

0.00
0.00
0.00
-56.80
-56.80

0.00
0.00
0.00
-59.97
-59.97

0.00
0.00
0.00
-63.24
-63.24

0.00
0.00
0.00
-66.61
-66.61

-3.70

65.32

51.10

53.16

55.16

57.07

32.10
28.40

28.40
93.72

93.72
144.82

144.82
197.99

197.99
253.15

253.15
310.22

Income Statement and Balance Sheet for OLP Limited

CircularityOn
On
CircularityOn

Income Statement ($ Million)

in $ Millions, excepting per share data

Sales
Cost of Sales
Other Operating Income
Gross Operating Income

2010A
1234.9
679.1
11.8
567.6

Actuals
2011A
1251.7
659
7.6
600.3

2012A
1300.4
681.3
7
626.1

2013A
1334.40
667.00
8.20
675.60

2014E
1401.12
700.56
9.81
710.37

Projected Figures
2015E
2016E
2017E
1471.18
1544.73
1621.97
735.59
772.37
810.99
10.30
10.81
11.35
745.89
783.18
822.34

2018E
1703.07
851.54
11.92
863.46

Selling, General & Admn. Expenses

Depreciation
EBIT

339.7
47.5
180.4

348.6
52
199.7

351.2
55.9
219

373.30
75.20
227.10

406.32
78.89
225.15

426.64
85.20
234.04

447.97
92.02
243.19

470.37
99.38
252.59

493.89
107.33
262.23

Interest Income
Interest Expense
Pre-Tax Income

1.3
16.2
165.5

1.4
15.1
186

1.7
20.5
200.2

2.00
23.70
205.40

1.70
18.94
207.92

1.77
14.89
220.92

1.85
11.27
233.77

1.95
7.49
247.04

2.04
3.57
260.71

Income Taxes
Net Income

56.8
108.7

64.2
121.8

67.5
132.7

72.60
132.80

72.77
135.15

77.32
143.60

81.82
151.95

86.46
160.58

91.25
169.46

38.3
70.4

38.7
83.1

39.8
92.9

40.10
92.70

54.06
81.09

57.44
86.16

60.78
91.17

64.23
96.35

67.78
101.68

Assets
Cash and Marketable Securities
Accounts Receivable
Inventories
Other Current Assets
Total Current Assets

25.6
99.4
109.6
96.7
331.3

23
102.9
108
91.4
325.3

32.1
107.3
114.9
103.7
358

28.40
120.10
116.80
97.50
362.80

29.42
117.69
123.30
106.49
376.90

30.89
123.58
129.46
111.81
395.75

32.44
129.76
135.94
117.40
415.53

34.06
136.25
142.73
123.27
436.31

35.76
143.06
149.87
129.43
458.13

Gross Fixed Assets

Accumulated Depreciation
Net Fixed Assets

680.9
244.8
436.1

734.3
296.8
437.5

820.8
352.7
468.1

913.10
427.90
485.20

986.15
506.79
479.36

1065.04
592.00
473.04

1150.24
684.01
466.23

1242.26
783.40
458.87

1341.64
890.73
450.92

Other Non-Current Assets

Total Non-Current Assets

203.2
639.3

205.1
642.6

407
875.1

456.30
941.50

492.80
972.16

532.23
1005.27

574.81
1041.04

620.79
1079.66

670.45
1121.37

Dividends
Addition to Retained Earnings

Balance Sheet ($ Million)

970.6

967.9

1233.1

1304.30

1349.06

1401.02

1456.57

1515.97

1579.50

Liabilities and Shareholders' Equity

Accounts Payable
Short-Term Debt
Other Current Liabilities
Total Current Liabilities

Total Assets

82.8
39.1
152
273.9

77.1
29.7
123.8
230.6

71.8
79.8
172.1
323.7

80.50
110.30
111.30
302.10

85.47
45.11
116.29
246.87

89.74
-5.48
122.11
206.37

94.23
-58.32
128.21
164.12

98.94
-113.34
134.62
120.23

103.89
-170.46
141.35
74.78

Long-Term Debt
Deferred Income Taxes
Other Non-Current Liabilities
Total Liabilities

163.5
22.3
100.6
560.3

145
19.6
80.1
475.3

201.8
15
115
655.5

218.10
12.70
94.50
627.40

218.10
19.62
106.49
591.07

218.10
20.60
111.81
556.87

218.10
21.63
117.40
521.25

218.10
22.71
123.27
484.30

218.10
23.84
129.43
446.16

Share Capital
Retained Earnings
Total Shareholders' Equity

46.9
363.4
410.3

46.1
446.5
492.6

38.2
539.4
577.6

44.80
632.10
676.90

44.80
713.19
757.99

44.80
799.35
844.15

44.80
890.52
935.32

44.80
986.86
1031.66

44.80
1088.54
1133.34

970.6

967.9

1233.1

1304.30

1349.06

1401.02

1456.57

1515.97

1579.50

Ok

Ok

Ok

OK

OK

OK

OK

OK

OK

Circularity

Total Liabilities and Shareholders' Equity

Discretionary Funding Need (DFN)

ShortTerm Debt 2014

I
Shareholders' Equity 2014

Break here
1-----[]
Int Expense 2014
I
[]-------1
Retained Earnings 2014

Income Statement and Balance Sheet for OLP Limited

CircularityOn
On
CircularityOn

Income Statement ($ Million)

in $ Millions, excepting per share data

Sales
Cost of Sales
Other Operating Income
Gross Operating Income

2010A
1234.9
679.1
11.8
567.6

Actuals
2011A
1251.7
659
7.6
600.3

2012A
1300.4
681.3
7
626.1

2013A
1334.40
667.00
8.20
675.60

2014E
1401.12
700.56
9.81
710.37

Projected Figures
2015E
2016E
2017E
1471.18
1544.73
1621.97
735.59
772.37
810.99
10.30
10.81
11.35
745.89
783.18
822.34

2018E
1703.07
851.54
11.92
863.46

Selling, General & Admn. Expenses

Depreciation
EBIT

339.7
47.5
180.4

348.6
52
199.7

351.2
55.9
219

373.30
75.20
227.10

406.32
78.89
225.15

426.64
85.20
234.04

447.97
92.02
243.19

470.37
99.38
252.59

493.89
107.33
262.23

Interest Income
Interest Expense
Pre-Tax Income

1.3
16.2
165.5

1.4
15.1
186

1.7
20.5
200.2

2.00
23.70
205.40

1.70
18.94
207.92

1.77
14.89
220.92

1.85
11.27
233.77

1.95
7.49
247.04

2.04
3.57
260.71

Income Taxes
Net Income

56.8
108.7

64.2
121.8

67.5
132.7

72.60
132.80

72.77
135.15

77.32
143.60

81.82
151.95

86.46
160.58

91.25
169.46

38.3
70.4

38.7
83.1

39.8
92.9

40.10
92.70

54.06
81.09

57.44
86.16

60.78
91.17

64.23
96.35

67.78
101.68

Assets
Cash and Marketable Securities
Accounts Receivable
Inventories
Other Current Assets
Total Current Assets

25.6
99.4
109.6
96.7
331.3

23
102.9
108
91.4
325.3

32.1
107.3
114.9
103.7
358

28.40
120.10
116.80
97.50
362.80

29.42
117.69
123.30
106.49
376.90

30.89
123.58
129.46
111.81
395.75

32.44
129.76
135.94
117.40
415.53

34.06
136.25
142.73
123.27
436.31

35.76
143.06
149.87
129.43
458.13

Gross Fixed Assets

Accumulated Depreciation
Net Fixed Assets

680.9
244.8
436.1

734.3
296.8
437.5

820.8
352.7
468.1

913.10
427.90
485.20

986.15
506.79
479.36

1065.04
592.00
473.04

1150.24
684.01
466.23

1242.26
783.40
458.87

1341.64
890.73
450.92

Other Non-Current Assets

Total Non-Current Assets

203.2
639.3

205.1
642.6

407
875.1

456.30
941.50

492.80
972.16

532.23
1005.27

574.81
1041.04

620.79
1079.66

670.45
1121.37

Dividends
Addition to Retained Earnings

Balance Sheet ($ Million)

970.6

967.9

1233.1

1304.30

1349.06

1401.02

1456.57

1515.97

1579.50

Liabilities and Shareholders' Equity

Accounts Payable
Short-Term Debt
Other Current Liabilities
Total Current Liabilities

Total Assets

82.8
39.1
152
273.9

77.1
29.7
123.8
230.6

71.8
79.8
172.1
323.7

80.50
110.30
111.30
302.10

85.47
45.11
116.29
246.87

89.74
-5.48
122.11
206.37

94.23
-58.32
128.21
164.12

98.94
-113.34
134.62
120.23

103.89
-170.46
141.35
74.78

Long-Term Debt
Deferred Income Taxes
Other Non-Current Liabilities
Total Liabilities

163.5
22.3
100.6
560.3

145
19.6
80.1
475.3

201.8
15
115
655.5

218.10
12.70
94.50
627.40

218.10
19.62
106.49
591.07

218.10
20.60
111.81
556.87

218.10
21.63
117.40
521.25

218.10
22.71
123.27
484.30

218.10
23.84
129.43
446.16

Share Capital
Retained Earnings
Total Shareholders' Equity

46.9
363.4
410.3

46.1
446.5
492.6

38.2
539.4
577.6

44.80
632.10
676.90

44.80
713.19
757.99

44.80
799.35
844.15

44.80
890.52
935.32

44.80
986.86
1031.66

44.80
1088.54
1133.34

970.6

967.9

1233.1

1304.30

1349.06

1401.02

1456.57

1515.97

1579.50

Ok

Ok

Ok

OK

OK

OK

OK

OK

OK

Circularity

Total Liabilities and Shareholders' Equity

Discretionary Funding Need (DFN)

ShortTerm Debt 2014

I
Shareholders' Equity 2014

Break here
1-----[]
Int Expense 2014
I
[]-------1
Retained Earnings 2014