Three Statement Financial Excel Model and Valuation Template

Description
This generic three statement financial model allows you to forecast your Company's profit and loss account, balance sheet and cash flow statement. Based on these financials the model also estimates the value of your company using the DCF method (Income approach).

The model allows you to enter your assumptions (in the yellow cells) and based on these it will generate the Company's statements.

It was build as flexible as possible for a generic model so that it might fit a large range of Companies and industries. The tabs provided can be split into two main categories:

1. Inputs tabs:
a) General inputs - in this tab you will enter general information such as display currency, valuation date, forecast years, tax rate, depreciation information, planned CAPEX and discount rate;
b) P&L inputs - in this tab you can enter your assumptions regarding revenue and cost evolution. Costs are split into two main categories:
- variable (or direct) costs, which are estimated based on weight in revenues (as per your judgement);
- fixed costs, which are estimated based on growth/decline compared to previous year.
c) BS inputs - in this tab you can enter the historical balance sheet items;
d) Working capital - in this tab you enter the estimated days for each category of working capital in order to derive the forecast for working capital items;
e) Debt repayment - in this tab you can estimate the repayment of debt and implicitly the interest expense for each forecast year. There are 3 credit areas which can be filled out by the user.

2. Output tabs:
a) P&L output;
b) Balance sheet output;
c) Cash flow Statement;
d) DCF Valuation - It is based on free cash flow to equity and consequently the discount rate used is the WACC. The only area you should pay attention in this tab is the Net Debt figure in cell E27. If you customize the Balance sheet or include other items, this figure should be updated to reflect the net debt at the valuation date.
e) Timing - used for periods and times;
f) Check sheet

This is a simple yet complete tool that will allow you to create accurate forecasts for your Company in order to see its performance at any given time. The valuation part of the model allows you to easily estimate the value of the Company at any given time, based on your own projections. This is a great way to assess your risks and opportunities in situations such as M&A deals.

Should you have any questions on the model you can always contact us.