Project Finance Debt Metrics (Manual and Template)

Description
This manual and accompanying workbook are designed to help you build necessary metrics required by lenders into your Project financial model. The workbook can be used as a template for building these metrics into your own financial model.

In this manual you will learn:

- Debt Service Cover Ratios, how to calculate and interpret?
- Summary DSCR, how to calculate and interpret?
- Loan Life Cover Ratios, how to calculate and interpret?
- Average Debt Life, how to calculate and interpret?

The calculations are done assuming two tranches of senior debt facilities are available.

The manual and the Excel spreadsheet are mainly for educational purpose. If you want to integrate the excel in your models, then you need to link the yellow highlighted lines to your own model.

In the Excel template, in addition to the sheet labeled "Debt Metrics" which contains the calculation of: Periodic Debt Service Cover Ratios, Minimum DSCR, Maximum DSCR, LLCR and Average loan life, you can also find the below sheets.

- “Timing: Contains the necessary flags and counters to make the model timeline flexible.
- “Sens”: Dedicated to sensitivity analysis. Once you have all the modules in place, you can use this sheet to perform sensitivity analysis.
- “Checks”: contains typical integrity checks to be included in the model. As you progress in building different components of the financial model, you can use this sheet as a road map on the checks that need to be included and eventually you create the checks and link them to this sheet.