Group Number: 1. Process Instrumentation Subdivision 1.1. The data Old pressure transmitter equipment production 0 Market values Units Growth Share Initial 100 000 0% 50% Market Units Market Share Units Price per unit Cost per unit 100 000 50% 50 000 600 480 2 100 000 50% 50 000 570 456 3 100 000 50% 50 000 542 433 4 5 100 000 100 000 50% 50% 50 000 50 000 514 489 412 391 Company values Price per unit Price growth Cost per unit Fixed cost Initial 600 -5% 80% 5 200 000 30% 30 000 000 28 500 000 27 075 000 25 721 250 24 435 188 24 000 000 22 800 000 21 660 000 20 577 000 19 548 150 5 200 000 5 200 000 5 200 000 5 200 000 5200 000 2 000 000 2 000 000 2 000 000 2 000 000 2 000 000 -1 200 000 -1 500 000 -1 785 000 -2 055 750 -2 312 963 - 360 000 450 000 535 500 -616 725-693 889 -840 000 -1 050 000 -1 249 500 -1 439 025 -1 619 074 2 000 000 2 000 000 2 000 000 2 000 000 2 000 000 Tax rate Revenues Variable cost Fixed cost Depreciation Profit before tax Taxes (30%) NOPAT Depreciation CAPEX Change in Working Capital Cash Flow PV Cash Flow CAPEX Discount rate Depreciation 10% 2 000 000 0 0 1160 000 950 000 0 0 1054545 785 124 750 500 563 862 560 975 383 153 380 926 236 525 3 023 210 3 023 210 NPV IRR Payback period Discounted payback period Sales | %EBIT DOL Financial Break-even -5.0% 19.0% -3.8 -5.0% 15.2% -3.0 -5,0% 12.5% -2.5 Market values Units Growth Share Initial 100 000 0% 0% 50% New pressure transmitter equipment project 0 1 2 Market Units 100 000 100 000 Market Share 50% 50% Units 50 000 50 000 Price per unit 600 570 Cost per unit 330 314 3 100 000 50% 50 000 542 298 4 100 000 50% % 50 000 514 283 5 100 000 50% 50 000 489 269 Company values Price per unit Price growth Cost per unit Fixed cost Tax rate CAPEX Discount rate Salvage value after tax Initial 600 -5% 55% 5 200 000 30% -19 000 000 10% 1 000 000 Revenues Variable cost Fixed cost Depreciation Profit before tax Taxes (30%) NOPAT Depreciation CAPEX Salvage value after tax Change in Working Capital Cash Flow PV Cash Flow 30 000 000 28 500 000 27 075 000 25 721 250 24 435 188 16 500 000 15 675 000 14 891 250 14 146 688 13 439 353 5 200 000 5 200 000 5 200 000 5 200 000 5200 000 3 800 000 3 800 000 3 800 3 800 000 3 800 000 4 500 000 3 825 000 3 183 750 2 574 563 1 995 834 1 350 000 1 147 500 955 125 772 369598 750 3 150 000 2 677 500 2 228 625 1 802 194 1397 084 3 800 000 3 800 000 3 800 000 3 800 000 3 800 000 -19 000 000 1 000 000 -18 000 000 6950 000 6 477 500 6028 625 5602 194 5 197 084 -18 000 000 6 318 182 5353 306 4529 395 3826 374 3 226 980 5 254 237 21.51% 5 254 237 2.76 3,47 NPV IRR Payback period Discounted payback period Incremental NPV Sales | XEBIT DOL Financial Break-even 2 231 027 -5.0% - 15.0% 3.0 22 533 -5.0% -16.8% 3.4 22 533 -5.0% -19.1% 3.8 22 533 -5.0% -22.5% 4.5 22 533 22 533 2 Group Number: 3 Market values Units Growth Share Initial 100 DO 0% 509 Outsource pressure transmitter production project 0 2 Market Units 100 000 100 000 Market Share 50% 50% Units 50 000 50 000 Price per unit 600 570 Cost per unit 474 450 100 000 50% 50 000 542 425 4 100 000 50% 50 000 514 406 5 100 000 50% 50 000 489 386 Company values Price per unit Price growth cost per unit Fixed cost Tax rate CAPEX Discount rate Depreciation Accounts payable Initial 600 -5% 79% 5 200 000 30% Revenues Variable cost Fixed cost Depreciation Profit before tax Taxes (30%) NOPAT Depreciation CAPEX Change in Working Capital Increase in Accounts Payable Increase in Inventory Cash Flow PV Cash Flow 30 000 000 28 500 000 27 075 000 25 721 250 24 435 188 23 700 000 22 515 000 21 389 250 20 319 788 19 303 798 5 200 000 5 200 000 5 200 000 5 200 000 5 200 000 2 000 000 2 000 000 2 000 000 2 000 000 2 000 000 -900 000 -1 215 000 -1514 250 -1 798 538 -2 068 611 -270 000 364 500 454 275 -539 561.620 583 -630 000-850 500 -1 059 975 -1 258 976 -1 448 027 2 000 000 2 000 000 2 000 000 2 000 000 2 000 000 10% 2 000 000 15% 0 3 555 000 3 555 000 -3555 000 -3555 000 0 0 4925 000 1 149 500 4 477 273 950 000 940 025 706 255 741 024 3 003 027 506 129 1 864 644 4 775 013 4 775 013 NPV IRR Payback period Discounted payback period incremental NPV %Sales %EBIT DOL Financial Break-even 1 751 803 -5.0% 35.0% -7.0 -5.0% 24.6% -4.9 -5.0% % 18.8% -3.8 -5.0% 15.0% -3.0 In-house pressure transmitter production project 0 Market values Units Growth Share Initial 100 000 0% 50% Market Units Market Share Units Price per unit Cost per unit 1 100 000 50% 50 000 600 402 2 100 000 50% 50 000 570 382 100 000 50% 50 000 542 363 4 100 000 50% 50 000 514 345 5 100 000 SOX 50 0001 489 327 Company values Price per unit Price growth Cost per unit Fixed cost Tax rate CAPEX Discount rate Depreciation Accounts payable Initial 600 -5% 67% 5 200 000 30% -9 000 000 10% 2 000 000 15% Revenues Variable cost Fixed cost Depreciation Profit before tax Taxes (@30%) NOPAT Depreciation CAPEX Change in Worcing Capital Increase in Accounts Payable Increase in Inventory Cash Flow PV Cash Flow 30 000 000 28 500 000 27 075 000 25 721 250 24 435 189 20 100 000 19 095 000 18 140 250 17 233 238 16 371 576 5 200 000 5 200 000 5 200 000 5 200 000 5200 000 3 800 000 3 800 000 3 800 000 3 800 000 3 800 000 900 000 405 000 -65 250 -511 988 -936 388 270 000 121 500 -19 575 - 153 596 -280 916 630 000 283 500 -45 675 -358 391 -655 4721 3 800 000 3 800 000 3 800 000 3 800 000 3 800 000 -9 000 000 -1 340 000 1 340 000 -3 015000 3 015 000 1 675 000 -1 675 000 3 090 000 4 083 500 3754 325 3441 609 4 484 528 2 809 091 3 374 793 2 820 680 2 350 665 2 784 539 -9000 000 9000 000 5 139 769 5 139 769 29.53% 2.49 3.00 NPV IRR Payback period Discounted payback period Incremental NPV %Sales %EBIT DOL Financial Break-even 2 116 559 -5.0% -55.0% 11.0 30 833 -5.0% - 116.1% 23.2 30 833 -5.0% 684.7% - 1369 30 833 -5.0% 82.9% -16.5 30 833 30 B33 3 Group Number: 1.2. The analysis under certainty What is your analysis about these projects? 1.3. The analysis under uncertainty What is the consequence of change of the initial values for the old pressure transmitter equipment production? % change of initial value Incremental NPV % change of NPV Market share -10% Price per unit -10% Cost per unit +10% Fixed cost +10% What is the consequence of change of the initial values for the new pressure transmitter equipment project? % change of initial value Incremental NPV % change of NPV Market share -10% Price per unit -10% Cost per unit +10% Fixed cost +10% Group Number: What is the consequence of change of the initial values for the outsource pressure transmitter production project? % change of initial value Incremental NPV % change of NPV Market share -10% Price per unit -10% Cost per unit +1094 Fixed cost +10 What is the consequence of change of the initial values for the in-house pressure transmitter production project? % change of initial value Incremental NPV % change of NPV Market share -10% Price per unit -10% Cost per unit +10% Fixed cost +10% What is your advice to the financial manager taking into account your previous analysis and these uncertainty data! 5 Group Number: 1. Process Instrumentation Subdivision 1.1. The data Old pressure transmitter equipment production 0 Market values Units Growth Share Initial 100 000 0% 50% Market Units Market Share Units Price per unit Cost per unit 100 000 50% 50 000 600 480 2 100 000 50% 50 000 570 456 3 100 000 50% 50 000 542 433 4 5 100 000 100 000 50% 50% 50 000 50 000 514 489 412 391 Company values Price per unit Price growth Cost per unit Fixed cost Initial 600 -5% 80% 5 200 000 30% 30 000 000 28 500 000 27 075 000 25 721 250 24 435 188 24 000 000 22 800 000 21 660 000 20 577 000 19 548 150 5 200 000 5 200 000 5 200 000 5 200 000 5200 000 2 000 000 2 000 000 2 000 000 2 000 000 2 000 000 -1 200 000 -1 500 000 -1 785 000 -2 055 750 -2 312 963 - 360 000 450 000 535 500 -616 725-693 889 -840 000 -1 050 000 -1 249 500 -1 439 025 -1 619 074 2 000 000 2 000 000 2 000 000 2 000 000 2 000 000 Tax rate Revenues Variable cost Fixed cost Depreciation Profit before tax Taxes (30%) NOPAT Depreciation CAPEX Change in Working Capital Cash Flow PV Cash Flow CAPEX Discount rate Depreciation 10% 2 000 000 0 0 1160 000 950 000 0 0 1054545 785 124 750 500 563 862 560 975 383 153 380 926 236 525 3 023 210 3 023 210 NPV IRR Payback period Discounted payback period Sales | %EBIT DOL Financial Break-even -5.0% 19.0% -3.8 -5.0% 15.2% -3.0 -5,0% 12.5% -2.5 Market values Units Growth Share Initial 100 000 0% 0% 50% New pressure transmitter equipment project 0 1 2 Market Units 100 000 100 000 Market Share 50% 50% Units 50 000 50 000 Price per unit 600 570 Cost per unit 330 314 3 100 000 50% 50 000 542 298 4 100 000 50% % 50 000 514 283 5 100 000 50% 50 000 489 269 Company values Price per unit Price growth Cost per unit Fixed cost Tax rate CAPEX Discount rate Salvage value after tax Initial 600 -5% 55% 5 200 000 30% -19 000 000 10% 1 000 000 Revenues Variable cost Fixed cost Depreciation Profit before tax Taxes (30%) NOPAT Depreciation CAPEX Salvage value after tax Change in Working Capital Cash Flow PV Cash Flow 30 000 000 28 500 000 27 075 000 25 721 250 24 435 188 16 500 000 15 675 000 14 891 250 14 146 688 13 439 353 5 200 000 5 200 000 5 200 000 5 200 000 5200 000 3 800 000 3 800 000 3 800 3 800 000 3 800 000 4 500 000 3 825 000 3 183 750 2 574 563 1 995 834 1 350 000 1 147 500 955 125 772 369598 750 3 150 000 2 677 500 2 228 625 1 802 194 1397 084 3 800 000 3 800 000 3 800 000 3 800 000 3 800 000 -19 000 000 1 000 000 -18 000 000 6950 000 6 477 500 6028 625 5602 194 5 197 084 -18 000 000 6 318 182 5353 306 4529 395 3826 374 3 226 980 5 254 237 21.51% 5 254 237 2.76 3,47 NPV IRR Payback period Discounted payback period Incremental NPV Sales | XEBIT DOL Financial Break-even 2 231 027 -5.0% - 15.0% 3.0 22 533 -5.0% -16.8% 3.4 22 533 -5.0% -19.1% 3.8 22 533 -5.0% -22.5% 4.5 22 533 22 533 2 Group Number: 3 Market values Units Growth Share Initial 100 DO 0% 509 Outsource pressure transmitter production project 0 2 Market Units 100 000 100 000 Market Share 50% 50% Units 50 000 50 000 Price per unit 600 570 Cost per unit 474 450 100 000 50% 50 000 542 425 4 100 000 50% 50 000 514 406 5 100 000 50% 50 000 489 386 Company values Price per unit Price growth cost per unit Fixed cost Tax rate CAPEX Discount rate Depreciation Accounts payable Initial 600 -5% 79% 5 200 000 30% Revenues Variable cost Fixed cost Depreciation Profit before tax Taxes (30%) NOPAT Depreciation CAPEX Change in Working Capital Increase in Accounts Payable Increase in Inventory Cash Flow PV Cash Flow 30 000 000 28 500 000 27 075 000 25 721 250 24 435 188 23 700 000 22 515 000 21 389 250 20 319 788 19 303 798 5 200 000 5 200 000 5 200 000 5 200 000 5 200 000 2 000 000 2 000 000 2 000 000 2 000 000 2 000 000 -900 000 -1 215 000 -1514 250 -1 798 538 -2 068 611 -270 000 364 500 454 275 -539 561.620 583 -630 000-850 500 -1 059 975 -1 258 976 -1 448 027 2 000 000 2 000 000 2 000 000 2 000 000 2 000 000 10% 2 000 000 15% 0 3 555 000 3 555 000 -3555 000 -3555 000 0 0 4925 000 1 149 500 4 477 273 950 000 940 025 706 255 741 024 3 003 027 506 129 1 864 644 4 775 013 4 775 013 NPV IRR Payback period Discounted payback period incremental NPV %Sales %EBIT DOL Financial Break-even 1 751 803 -5.0% 35.0% -7.0 -5.0% 24.6% -4.9 -5.0% % 18.8% -3.8 -5.0% 15.0% -3.0 In-house pressure transmitter production project 0 Market values Units Growth Share Initial 100 000 0% 50% Market Units Market Share Units Price per unit Cost per unit 1 100 000 50% 50 000 600 402 2 100 000 50% 50 000 570 382 100 000 50% 50 000 542 363 4 100 000 50% 50 000 514 345 5 100 000 SOX 50 0001 489 327 Company values Price per unit Price growth Cost per unit Fixed cost Tax rate CAPEX Discount rate Depreciation Accounts payable Initial 600 -5% 67% 5 200 000 30% -9 000 000 10% 2 000 000 15% Revenues Variable cost Fixed cost Depreciation Profit before tax Taxes (@30%) NOPAT Depreciation CAPEX Change in Worcing Capital Increase in Accounts Payable Increase in Inventory Cash Flow PV Cash Flow 30 000 000 28 500 000 27 075 000 25 721 250 24 435 189 20 100 000 19 095 000 18 140 250 17 233 238 16 371 576 5 200 000 5 200 000 5 200 000 5 200 000 5200 000 3 800 000 3 800 000 3 800 000 3 800 000 3 800 000 900 000 405 000 -65 250 -511 988 -936 388 270 000 121 500 -19 575 - 153 596 -280 916 630 000 283 500 -45 675 -358 391 -655 4721 3 800 000 3 800 000 3 800 000 3 800 000 3 800 000 -9 000 000 -1 340 000 1 340 000 -3 015000 3 015 000 1 675 000 -1 675 000 3 090 000 4 083 500 3754 325 3441 609 4 484 528 2 809 091 3 374 793 2 820 680 2 350 665 2 784 539 -9000 000 9000 000 5 139 769 5 139 769 29.53% 2.49 3.00 NPV IRR Payback period Discounted payback period Incremental NPV %Sales %EBIT DOL Financial Break-even 2 116 559 -5.0% -55.0% 11.0 30 833 -5.0% - 116.1% 23.2 30 833 -5.0% 684.7% - 1369 30 833 -5.0% 82.9% -16.5 30 833 30 B33 3 Group Number: 1.2. The analysis under certainty What is your analysis about these projects? 1.3. The analysis under uncertainty What is the consequence of change of the initial values for the old pressure transmitter equipment production? % change of initial value Incremental NPV % change of NPV Market share -10% Price per unit -10% Cost per unit +10% Fixed cost +10% What is the consequence of change of the initial values for the new pressure transmitter equipment project? % change of initial value Incremental NPV % change of NPV Market share -10% Price per unit -10% Cost per unit +10% Fixed cost +10% Group Number: What is the consequence of change of the initial values for the outsource pressure transmitter production project? % change of initial value Incremental NPV % change of NPV Market share -10% Price per unit -10% Cost per unit +1094 Fixed cost +10 What is the consequence of change of the initial values for the in-house pressure transmitter production project? % change of initial value Incremental NPV % change of NPV Market share -10% Price per unit -10% Cost per unit +10% Fixed cost +10% What is your advice to the financial manager taking into account your previous analysis and these uncertainty data! 5