Business Valuation Workbook

Description

Business Valuation Workbook

The Business Valuation Workbook is a structured, Excel-based financial model that estimates a company’s value using Discounted Cash Flow (DCF) analysis and EBITDA multiples. It is designed for accountants, financial analysts, business owners, and advisors who need to prepare defensible valuations for decision-making, investment planning, or business sales.

Purpose & Objectives

• Forecast Future Performance: Build multi-year financial projections (up to 7 years) including revenue, costs, and profit before interest and tax (PBIT).
• Valuation Calculation: Apply DCF methodology to discount projected cashflows using a weighted average cost of capital (WACC).
• Scenario Analysis: Adjust growth rates, cost inflation, and capital expenditure to see the impact on value in real time.
• Decision Support: Help stakeholders understand enterprise value and equity value under different assumptions.

Workbook Structure

• Data Assumptions Tab
  • Centralized location for entering key inputs:
    • Annual Sales & Growth Rates (Year 1–7)
    • Gross Profit %
    • Operating Expense Base & Inflation Rates
    • Working Capital Changes (inventory, debtors, creditors)
    • Capital Expenditure Schedule
    • Financing Assumptions including debt/equity mix, cost of debt, required return on equity, and profit multiple

• Cash Flow Projection Tab
  • Generates multi-year projections for:
    • Turnover & Cost of Sales
    • Gross Profit & Gross Margin
    • Operating Expenses (line by line)
    • PBIT
    • Working Capital Adjustments
    • Annual Free Cash Flow

• Cash Flow – Charts
  • Provides visual representations of turnover, costs, profit, and annual cash flow trends, making it easy to spot growth patterns and profitability shifts.

• Totals / Summary Tab
  • Summarizes key financial metrics year by year:
    • Turnover
    • Cost of Sales
    • Operating Expenses
    • PBIT

• Business Valuation Calculation Tab
  • This is the core valuation dashboard:
    • DCF Approach using WACC to discount free cashflows and calculate present value
    • EBITDA/PBIT Multiple Valuation for market comparison
    • Capital Structure Breakdown showing value split between debt and equity
    • 3-Year and 5-Year Valuation Results for comparison and sensitivity testing

• Valuation Charts
  • Visualizes free cash flow progression and valuation results for clear stakeholder communication.

Key Calculations & Outputs

• Enterprise Value (EV)
• Equity Value after debt adjustment
• PBIT/EBITDA Multiples for benchmarking
• WACC, Cost of Debt, and Cost of Equity metrics

Who Should Use It

• Business owners preparing for sale or investment
• Accountants and bookkeepers preparing client valuations
• Advisors and investors assessing acquisition opportunities