Financial Modeling Overview Presented to: October15, 2010

2 AGENDA I.Modeling Overview II.Income Statement III.Balance Sheet IV.Cash Flow Statement V.Supporting Schedules I.Depreciation and Amortization II.Debt

3  We’re given a basic income statement and balance sheet  We need to forecast :  Income statement  Balance sheet  PP&E and capex needs  Debt page  After we finish with projections, we need to tie the statements together  Ensure that the balance sheet balances OVERVIEW

4  Step 1, forecast income statement INCOME STATEMENT

5  Step 1, should look like this INCOME STATEMENT

6  Step 2, forecast balance sheet BALANCE SHEET

7  Step 2, should look like this BALANCE SHEET

8  Step 2, now we can forecast portions of the balance sheet to look like this BALANCE SHEET

9  Step 3, now we turn to PP&E, capital expenditures and depreciation PP&E, CAPEX, AND DEPRECIATION

10  Step 3, should look like this PP&E, CAPEX, AND DEPRECIATION

11  Step 4, link depreciation and amortization INCOME STATEMENT

12  Step 5, assemble cash flow statement through investing activities CASH FLOW STATEMENT

13  Step 5, should look like this CASH FLOW STATEMENT

14  Step 6, put together the debt page DEBT

15  Step 6, should look like this DEBT

16  Step 7, link interest expense INCOME STATEMENT

17  Step 8, finish our cash flow statement CASH FLOW STATEMENT

18  Step 9, last we finish the balance sheet and make sure we “BALANCE” BALANCE SHEET