New Advance Finance

New Advance Finance - Period EBITDA (Depreciation) EBIT...

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Period 0 1 2 3 4 5 1993 1994 1995 1996 1997 1998 EBITDA 560.5 660.56 737 790.8 848.4 910.1 (Depreciation) 221.1 162.00 172 184 196 209 EBIT 339.40 498.56 565.00 606.80 652.40 701.10 (Taxes) 125.58 184.47 209.05 224.52 241.39 259.41 EBIT (1-Tc) 213.82 314.09 355.95 382.28 411.01 441.69 Depreciation 221.1 162.00 172 184 196 209 (Capital Expenditure) 111.8 160.10 177.3 176.7 202.9 216.6 (Change in Working Capital) 97.8 45.60 62.1 66.5 71.2 76.2 Free Cash Flows 225.32 270.39 288.55 323.08 332.91 357.89 Debt forecast for APV 1002.90 1058.75 1117.71 1179.96 1245.67 1315.05 95 asset sold PV of FCF using WACC $225.32 $246.84 $240.47 $245.80 $231.22 $226.92 $750.05 $225.32 $245.19 $237.26 $240.89 $225.08 $219.42 $740.03 $371.07 $391.74 $413.55 $436.59 $460.90 $486.57 PV of Tax Shield $371.07 $355.22 $340.05 $325.52 $311.62 $298.30 Equity 4129.8 Debt 1002.9 Return on Equity 10.75% Return on Debt 7.24% Tax Rate 37.00% Risk Free Rate 6.25% Beta of Equity of Paramount 1 Market Risk Premium 4.50% WACC 9.54% GR of 93-94 of FCF 20.00% GR of 94-95 of FCF 6.72% GR of 95-96 of FCF 11.97% GR of 96-97 of FCF 3.04% GR of 97-98 of FCF 7.50% Average Growth Rate of FCF 9.85% Slowing of Growth Rate of FCF 2.50% Actual Growth of FCF 7.35% $10,161.98 Terminal Value of FCF using WACC $17,507.64 $13,095.85 $2,901.79 Assume debt stops growing after 1998 PV of Terminal Value of FCF using WACC $11,100.67 $8,028.78 PV of Terminal Value of Debt Tax Shield $1,779.02 Avg Value of Paramount PV (WACC) $13,267.31 13605.045 PV (APV) $13,942.78 14955.305 Return on Assets 10.28% GR of Debt 90-91 -26.99% Gr of Debt 91-92 56.20% Gr of Debt 92-93 23.49% Avg Growth of Debt 17.57% Slowing of Growth of Debt 12% Actual Growth of debt 5.57% PV of FCF using R A Tax Shield using R A V L= V U+ PVTS V u = Terminal Value of FCF using R A Terminal Value of Debt shield w/ R A PV of Terminal Value of FCF using RA
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Period 0 1 2 3 4 5 1993 1994 1995 1996 1997 1998 EBITDA 1436.60 1623 1786.8 2000.1 2192.2
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This document was uploaded on 11/04/2011 for the course BUSI 409 at UNC.

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New Advance Finance - Period EBITDA (Depreciation) EBIT...

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