A US coal mining client required a financial
model, as part of it's equity raising initiative to
prospective institutional investors.
Strategize Financial Modelling used the
Modano content management system (CMS),
in order to build an Excel-based financial model.
The Modano powered tool builds a more
robust, scalable and accurate projection of the
company's financial projections and valuation
for prospective equity investors.
Firstly, Strategize built a detailed, customised
and driver-based revenue module of the coal
miner's revenue forecast based on projected
coal price, strip ratio and overburden volumes.
The Modano Excel-based CMS model had to
account for partial ownership of one mine for
the purposes of forecasting and consolidating
the financial data.
This was repeated in a best case,
business scenario for the coal mining client's
pro forma financials and valuation.
Absolute forecast amounts were employed in
the model for Cost of Goods Sold,
and Operating Expenditure.
For the miner's base and best case forecast
scenarios by each mine site and
corporate function of the coal mining company.
The Strategize financial model projected
separate capex by each mine,
which flows into the fixed assets module.
In turn the fixed assets module calculates
forecast amortization and depreciation
by each mine and the corporate function.
The Strategize-built financial model using the
Modano CMS, allows the coal miner to alter the
capital mix for both base and best case
business scenarios of the forecast.
The financial model presents debt capital both
at a summary view and by each debt tranche.
The coal miner could present to prospective
equity investors a high-level valuation of the
mining company using a EBITDA valuation approach.
Thanks to the insertion of the
EBITDA Valuation (DCF, IRR) module
into the Modano-powered financial model.
The addition of the financial statements
summary dashboard module of the projected
coal miner's three-way financial projections,
which helps to further market the capital pitch
for additional equity capital from investors.
The financial summaries are presented for both
the base and best case business scenarios.
Strategize added detailed financial ratios
modules across the 5 year projection period
under both forecast scenarios.
This provides further insight into the mining
company's financial performance to
prospective equity investors.
The modular nature of the Modano CMS tool,
ensured Strategize can manage the forecast
model's overall consistency, integrity and
robustness at all times.
Especially with the addition of the best case
business scenario into the forecast model.
Not only does the Modano CMS build a more
dynamic, robust and scalable
financial modeling solution.
It also contains detailed error and alert checks
across the entire financial model.
And not simply a Balance Sheet check,
which basic financial models only do.