Project Finance Financial Models

The excel model and user manual are designed to assist in the evaluation of typical hydro power projects. The Financial Model (the “Model”) is a cash flow based project finance model that applies a set of stated assumptions in order to model the cash flows of a typical hydro project finance transaction and produce forecast financial statements.

The Financial Model (the “Model”) is a cash flow based project finance model that applies a set of stated assumptions in order to model the cash flows of a typical hydro project finance transaction and produce forecast financial statements. The Model was created in Microsoft Excel and is based on best practice financial modelling standards. The Model’s building blocks are distributed between preliminary sheets, input sheets, calculation sheets and output sheets. The Financial model contains 15 worksheets which are dynamically linked. 1. Guide: Contains the color codes used in the model, model structure and macros used in the model are listed in this worksheet. Key assumptions and results are also extracted here in form of tables and can be used as the databook and aims to facilitate the extraction of financial model assumptions and results to be used in project documents. 2. Tracker: Aims to keep a track of the changes through multiple versions 3. Q&A: To keep track of questions and answers on the financial model 4. Inputs: Contains the model inputs structure in form of scenario analysis. 5. Sens: Contains sensitivity inputs and outputs 6. Time: Calculation of the different timing flags and counters, used as time reference throughout the model. 7. CapEx: Calculation of construction cost breakdown 8. Financining: Includes: - Calculation of sources and uses of funds during the construction period. - Calculation of disbursement profile, interest and fees during construction - Debt drawdown and repayment profiles 9. Rev & Opex: Includes: - Capacity revenues - Energy revenues - Opex calculation - Account receivables - Account Payables 9. Tax: Includes calculation of: - Depreciation - Corporate Income tax payment 10. Return and Ratios: Calculation of debt and equity ratios, including the debt service coverage ratio (DSCR), loan life coverage ratio (LLCR) average loan life, debt returns, weighted average cost of capital (WACC) and equity IRR 11. IFS: Cashflow, balance sheet and income statement on periodic basis using time inputs from "Inputs" sheet. 12. Checks: contains model error and integrity checks 13. Summary: Summary key inputs & Outputs like Summary Sources and Uses of Funds Cover ratios, average loan life, and Shareholder return 14. AFS: Cashflow, balance sheet and income statement on annual basis The Model assumptions are in a dedicated sheet labeled "Inputs" Input Sheets. The layout of the "Inputs" sheet is designed in such a way to enable the user to run multiple scenarios. To calculate the Model, you should press the button: Run Macro. This should be done each time an assumption is changed. You can find the "Run Macro" button on top of each worksheet and also on top of the summary sheet.