Sheet Tab Description Author

1 Table of Contents
2 Corp Model Exercise
3 Assumptions
4 P&L
5 BS
6 CF
7 FA
8 Loans
9 WC
10 DCF
11 Relative
12 Blended

File Name: E:\XYZ Model-2 working.xlsx

Colour Codes

Date 24-Apr-12
Debt Balance 1
Historic Assets 1.00
P&L Check 1.00
Balance Sheet 1

Model Check 1
 Debt to Capital
30%

25%

20%

Debt to Capital
15%

10%

5%

0%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
Sc Number 1

Rev COGS as Cap Exp

Growth Pct of Sale to Sales A/R to Sales Inv to COGS

Base Case 1 1 2% 8.21% 21.80%

Low Case 2 2 4% 16% 35%
High Case 3 3 1% 7% 18%
Sensitivity 1 2 2% 8.21% 22.00%

Base Case 1 1 0.02 0.0821 0.218

22
 2012 2013 2014 2015 2016 2017 2018 2019 2020

Debt/Cap Debt/Cap Debt/Cap Debt/Cap Debt/Cap Debt/Cap Debt/Cap Debt/Cap Debt/Cap

22% 16% 16% 25% 25% 25% 25% 25% 25%
 2021 2022 2023 2024 2025 2026 2027 2028 2029

Debt/Cap Debt/Cap Debt/Cap Debt/Cap Debt/Cap Debt/Cap Debt/Cap Debt/Cap Debt/Cap

25% 25% 25% 25% 25% 25% 25% 25% 25%
Time Periods

First Historic Period 2008

Last Historic Period 2010
Number of Expicit Periods 5
End of Explicit Period 2015

Model Time Line

Year 2008 2009 2010 2011
Historic Period Switch 1 1 1 0
Expicit Forecast Swtich 0 0 0 1
Terminal Year Switch 0 0 0 0

Historic Financial Statements

Amounts in SAR Millions 2008 2009 2010

Revenues 2,519.92 2,555.31 3,014.57

Cost of Sales (2,084.93) (2,068.93) (2,512.99)
Gross Profit 434.99 486.38 501.58

Selling & Distribution Expenses (35.03) (50.30) (50.11)

General & Administration Expenses (50.73) (51.61) (55.79)

Net Operating Income (EBIT) 349.22 384.46 395.68

Financial Charges (12.95) (13.49) (11.41)

Other Income 5.25 13.65 28.90

Net Income Before Zakat (EBT) 341.52 384.62 413.16

Zakat & Taxes (8.75) (10.65) (12.42)

Net Income (PAT) 332.77 373.97 400.74

Amounts in SAR Millions 2008 2009 2010

Cash & Bank Balances 60.41 75.52 87.87

Accounts Receivable 189.75 218.02 247.52
Inventories 390.83 421.42 543.05
Current Assets 640.99 714.97 878.43

Fixed Assets 521.93 535.44 555.02

 Non-Current Assets 521.93 535.44 555.02

Total Assets 1,162.92 1,250.42 1,433.45

Bank Loans - Current 42.03 37.05 50.11

Accounts Payable 190.14 277.06 350.90
Other Payables 60.65 68.22 100.07
Current Liabilities 292.82 382.34 501.08

Bank Loans - Non current 150.00 100.00 100.00

EOSB 33.23 45.24 34.79
Non-Current Liabilities 183.23 145.24 134.79

Share Capital 300.00 400.00 400.00

Retained Earnings 386.87 322.84 397.58
Net Worth 686.87 722.84 797.58

Total Liabilities & Net Worth 1,162.92 1,250.42 1,433.45

A-L 1.00 1.00 1.00

Cash Flow Statement 2008 2009 2010

Net Income (PAT) 373.97 400.74

Depreciation 18.00 18.36 19.40
ESOB 12.01 (10.45)
Gain on Sale of Fixed Assets 0.33 0.07
Net Increase in Working Capital 35.62 (45.43)
Net cash from Operating Activities 440.29 364.32

Investment in Fixed Assets (31.88) (38.97)

Proceeds from sale of Fixed Assets (0.32) (0.06)
Net cash used in Investing Activities (32.20) (39.04)

Borrowings (54.97) 13.06

Dividends (338.00) (326.00)
Net cash from/used in Financing Activities (392.97) (312.94)

Increase/Decrease in Cash 15.12 12.34

Opening Cash Balance at the beginning of the year 60.41 75.52

Closing Cash Balance at the end of the year 75.52 87.87

Analysis of History
 EBITDA 367.22 402.82 415.08
Cash Cost of Goods Sold 2,066.93 2,050.57 2,493.59
Operating Margin 15% 16% 14%

Invested Capital 818.49 784.37 859.83

Alt Invested Capial 818.49 784.37 859.83
Effective Zakat Rate 2.56% 2.77% 3.01%
EBIT 349.22 384.46 395.68
NOPLAT: EBIT x (1-t) 340.27 373.82 383.79
ROIC 42% 48% 45%

ROE 48.4% 51.7% 50.2%

Cap Exp to Dep 173.6% 200.9%

Assumptions

Operating assumptions
Revenue Growth Rate 1.40% 17.97%
Base Case 1.40% 17.97% 15%
Low Case 1.40% 17.97% 10%
High Case 1.40% 17.97% 20%

Revenue Growth Scenario 1

Base Case 0.014043314 0.179727594 0.15

COGS Percent
Base 82.0% 80.2% 82.7% 81.50%
Pessimistic 82.0% 80.2% 82.7% 83%
Optimistic 82.0% 80.2% 82.7% 80%

Margin Scenario 1

Base 82% 80% 83% 82%

Distribution as Pct of Sales 1.39% 1.97% 1.66% 1.75%

G&A Growth Rate 1.73% 8.09% 15%

Cap Exp to Sales 1.25% 1.29% 2%

A/R to Sales 7.53% 8.53% 8.21% 8.21%

Invetnories to COGS 18.9% 20.6% 21.8% 21.80%

Accounts Payables to COGS 9.20% 13.51% 14.07% 14%

 Depreciation Rate 3.4% 3.4% 3.5% 3.50%

Effective Zakat Rate 2.56% 2.77% 3.01% 3%

Financing Assumptions

Debt Assumptions
Reapyment of Long-term Loans 25
Interest Rate on Long-term Loans 8%

Interest Rate on Short-term Loans 6%

Interest Income Rate on Cash 1%

Dividend Payout Ratio - 0.90 0.81 114%

Operating Analysis

Revenues 2,519.92 2,555.31 3,014.57 3,466.75

Cash COGS 2,066.93 2,050.57 2,493.59 2,825.40
Distribution Expense 35.03 50.30 50.11 60.67
G&A Expenses 50.73 51.61 55.79 64.16
Total Cash Expense 4,672.62 4,707.79 5,614.05 6,416.98

Cap Exp to Sales Ratio 1% 1% 2%

Total Cap Exp 31.88 38.97 69.33

Other Income 5.25 13.65 28.90 28.90

Working Capital Analysis

Accounts Receivable
Revenues 2,519.92 2,555.31 3,014.57 3,466.75
A/R as Percent of Sales 7.53% 8.53% 8.21% 8.21%
Total A/R 189.75 218.02 247.52 284.62

Inventories
Inventories as Pct of COGS 18.9% 20.6% 21.8% 21.8%
Total Inventories 390.83 421.42 543.05 615.94

Accounts Payable
A/P to COGS 9.20% 13.51% 14.07% 14.00%
Total A/P 190.14 277.06 350.90 395.56

Other Current Liab 60.65 68.22 100.07 100.07

 Total Working Caputal 329.78 294.16 339.60 404.93
Change in Working Capital (35.62) 45.43 65.34

Long-term Assets

Plant Assets
Opening Balance of Net Plant 521.93 535.44 555.02
Add: Capital Expenditures 31.88 38.97 69.33
Less: Depreciation 18.36 19.40 19.43
Closing Balance 521.93 535.44 555.02 604.93

Depreciation Rate on Net Plant 3.4% 3.4% 3.5% 3.5%

Depreciation Expense 18.00 18.36 19.40 19.43

Goodwill - - - -
Non-Associated Investmments - - - -

Long-term Liabilities and Short-term Debt

Long-term Debt
Opening Balance 150.00 100.00 100.00
Less: Repayments - - 25.00
Closing Balance 150.00 100.00 100.00 75.00

EOSB 33.23 45.24 34.79 34.79

Check 1 1 1 1
Aggregate Check 1

Interest Rate 0% 0% 0% 8%
Interest Expense 12.95 13.49 11.41 8.00

Bucket of Cash Minus Short-term Debt

Opening Balance 18.38 38.47 37.76
Add: Net Cash Flow 58.07 9.73 (206.52)
Closing Balance 18.38 38.47 37.76 (168.77)

Cash Balance 60.41 75.52 87.87 -

Short-term Debt Balance 42.03 37.05 50.11 168.77

Interest Rate on Cash 0% 0% 0% 1%

Interest Income - - 0.88

Interest Rate on Short-term Debt 0% 0% 0% 6%

 Interest Expense on Short-term Debt - - 3.01

Profit and Loss

Sales 2,519.92 2,555.31 3,014.57 3,466.75
Less: COGS 2,066.93 2,050.57 2,493.59 2,825.40
Less: Distribution 35.03 50.30 50.11 60.67
Less: G&A Expense 50.73 51.61 55.79 64.16
EBITDA 367.22 402.82 415.08 516.52
Less: Deprecation 18.00 18.36 19.40 19.43
EBIT 349.22 384.46 395.68 497.10
Less: Interest Expense on Long-term 12.95 13.49 11.41 8.00
Less: Interest Expense on Short-term - - - 3.01
Add: Interest Income - - - 0.88
Add: Other Income 5.25 13.65 28.90 -
EBZ 341.52 384.62 413.16 486.97
Less: Zakat 8.75 10.65 12.42 14.61
Eanings Before Minority Interest 332.77 373.97 400.74 472.36
Less: Minority Interest - - - -
Net Earnings 332.77 373.97 400.74 472.36

Actual NI 332.77 373.97 400.74 -

Difference - - - 472.36
Test 1.00 1.00 1.00
Aggregate Check 1.00

Cash Flow
EBITDA 367.22 402.82 415.08 516.52
Less: WC Changes - (35.62) 45.43 65.34
Less: Zakat 8.75 10.65 12.42 14.61
Operating Cash Flow 358.47 427.79 357.23 436.58
Less: Captial Expenditures - 31.88 38.97 69.33
Cash Flow Before Financing 358.47 395.91 318.25 367.24
Less: Debt repayment on Long-term - - - 25.00
Less: Net Interest Expense 7.70 (0.16) (17.48) 10.13
Less: Dividends - 338.00 326.00 538.64
Net Cash Flow 350.77 58.07 9.73 (206.52)

Balance Sheet

Common Equity
Opening Balance 686.87 722.84 797.58
Add: Net Income 373.97 400.74 472.36
Less: Dividends 338.00 326.00 538.64
Closing Balace 686.87 722.84 797.58 731.31
 Assets
Cash 60.41 75.52 87.87 -
A/R 189.75 218.02 247.52 284.62
Inventories 390.83 421.42 543.05 615.94
Total Current Assets 640.99 714.97 878.43 900.56

Net Fixed Assets 521.93 535.44 555.02 604.93

Goodwill - - - -
Non-Associated Investments - - - -
Total Long-term Assets 521.93 535.44 555.02 604.93

Total Assets 1,162.92 1,250.42 1,433.45 1,505.48

Historic Asset Check 1.00 1.00 1.00
Aggregate 1.00

Liabilites and Capital

Current Liabilities
Short-term Debt 42.03 37.05 50.11 168.77
A/P 190.14 277.06 350.90 395.56
Other Current Liab 60.65 68.22 100.07 100.07
Total Current Liab 292.82 382.34 501.08 664.39

Long-term Debt 150.00 100.00 100.00 75.00

EOSB 33.23 45.24 34.79 34.79

Equity Capital 686.87 722.84 797.58 731.31

Total Liabities and Captial 1,162.92 1,250.42 1,433.45 1,505.48

Difference - - - -
Test 1 1 1 1
Aggregate Test 1

ROE 48% 52% 50% 65%

2012 2013 2014 2015

Debt to Capital 22% 16% 16% 25%

Taget Debt to Capital 25%

2012 2013 2014 2015 2016 2017 2018 2019
0 0 0 0 0 0 0 0
1 1 1 1 0 0 0 0
0 0 0 1 0 0 0 0
 13% 10% 8% 6% 6% 6% 6% 6%
8% 6% 4% 4% 4% 4% 4% 4%
18% 15% 10% 10% 10% 10% 10% 10%

0.13 0.1 0.08 0.06 0.06 0.06 0.06 0.06

81.50% 82.00% 82.50% 83.00% 83.00% 83.00% 83.00% 83.00%

83.50% 84% 84% 84% 84% 84% 84% 84%
80% 80% 80% 80% 80% 80% 80% 80%

82% 82% 83% 83% 83% 83% 83% 83%

1.75% 1.75% 1.75% 1.75% 1.75% 1.75% 1.75% 1.75%

13% 10% 8% 6% 6% 6% 6% 6%

2% 2% 2% 2% 2% 2% 2% 2%

8.21% 8.21% 8.21% 8.21% 8.21% 8.21% 8.21% 8.21%

21.80% 21.80% 21.80% 21.80% 21.80% 21.80% 21.80% 21.80%

14% 14% 14% 14% 14% 14% 14% 14%

 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50%

3% 3% 3% 3% 3% 3% 3% 3%

25 25 25
8% 8% 8% 8% 8% 8% 8% 8%

6% 6% 6% 6% 6% 6% 6% 6%
1% 1% 1% 1% 1% 1% 1% 1%

83% 84% 85% 86% 86% 86% 86% 86%

3,917.43 4,309.17 4,653.90 4,933.14 5,229.13 5,542.87 5,875.45 6,227.97

3,192.70 3,533.52 3,839.47 4,094.50 4,340.17 4,600.59 4,876.62 5,169.22
68.55 75.41 81.44 86.33 91.51 97.00 102.82 108.99
72.50 79.75 86.13 91.30 96.77 102.58 108.74 115.26
7,251.18 7,997.85 8,660.95 9,205.27 9,757.58 10,343.04 10,963.62 11,621.44

2% 2% 2% 2% 2% 2% 2% 2%
78.35 86.18 93.08 98.66 104.58 110.86 117.51 124.56

28.90 28.90 28.90 28.90 28.90 28.90 28.90 28.90

3,917.43 4,309.17 4,653.90 4,933.14 5,229.13 5,542.87 5,875.45 6,227.97

8.21% 8.21% 8.21% 8.21% 8.21% 8.21% 8.21% 8.21%
321.62 353.78 382.09 405.01 429.31 455.07 482.37 511.32

21.8% 21.8% 21.8% 21.8% 21.8% 21.8% 21.8% 21.8%

696.01 770.31 837.00 892.60 946.16 1,002.93 1,063.10 1,126.89

14.00% 14.00% 14.00% 14.00% 14.00% 14.00% 14.00% 14.00%

446.98 494.69 537.53 573.23 607.62 644.08 682.73 723.69

100.07 100.07 100.07 100.07 100.07 100.07 100.07 100.07

470.58 529.33 581.50 624.31 667.78 713.85 762.68 814.45
65.65 58.75 52.17 42.82 43.46 46.07 48.83 51.77

604.93 662.10 725.11 792.81 863.73 938.08 1,016.10 1,098.05

78.35 86.18 93.08 98.66 104.58 110.86 117.51 124.56
21.17 23.17 25.38 27.75 30.23 32.83 35.56 38.43
662.10 725.11 792.81 863.73 938.08 1,016.10 1,098.05 1,184.18

3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5%

21.17 23.17 25.38 27.75 30.23 32.83 35.56 38.43

- - - - - - - -
- - - - - - - -

75.00 50.00 25.00 - - - - -

25.00 25.00 25.00 - - - - -
50.00 25.00 - - - - - -

34.79 34.79 34.79 34.79 34.79 34.79 34.79 34.79

1 1 1 1 1 1 1 1

8% 8% 8% 8% 8% 8% 8% 8%
6.00 4.00 2.00 - - - - -

(168.77) (224.48) (279.91) (334.88) (363.31) (392.77) (423.79) (456.49)

(55.71) (55.44) (54.97) (28.43) (29.45) (31.02) (32.70) (34.47)
(224.48) (279.91) (334.88) (363.31) (392.77) (423.79) (456.49) (490.96)

- - - - - - - -
224.48 279.91 334.88 363.31 392.77 423.79 456.49 490.96

1% 1% 1% 1% 1% 1% 1% 1%
- - - - - - - -

6% 6% 6% 6% 6% 6% 6% 6%
 10.13 13.47 16.79 20.09 21.80 23.57 25.43 27.39

3,917.43 4,309.17 4,653.90 4,933.14 5,229.13 5,542.87 5,875.45 6,227.97

3,192.70 3,533.52 3,839.47 4,094.50 4,340.17 4,600.59 4,876.62 5,169.22
68.55 75.41 81.44 86.33 91.51 97.00 102.82 108.99
72.50 79.75 86.13 91.30 96.77 102.58 108.74 115.26
583.67 620.49 646.86 661.01 700.67 742.71 787.27 834.51
21.17 23.17 25.38 27.75 30.23 32.83 35.56 38.43
562.50 597.32 621.48 633.26 670.44 709.87 751.71 796.07
6.00 4.00 2.00 - - - - -
10.13 13.47 16.79 20.09 21.80 23.57 25.43 27.39
- - - - - - - -
- - - - - - - -
546.37 579.85 602.69 613.17 648.64 686.31 726.28 768.69
16.39 17.40 18.08 18.39 19.46 20.59 21.79 23.06
529.98 562.45 584.61 594.77 629.18 665.72 704.49 745.62
- - - - - - - -
529.98 562.45 584.61 594.77 629.18 665.72 704.49 745.62

- - - - - - - -
529.98 562.45 584.61 594.77 629.18 665.72 704.49 745.62

583.67 620.49 646.86 661.01 700.67 742.71 787.27 834.51

65.65 58.75 52.17 42.82 43.46 46.07 48.83 51.77
16.39 17.40 18.08 18.39 19.46 20.59 21.79 23.06
501.63 544.35 576.61 599.79 637.75 676.05 716.65 759.68
78.35 86.18 93.08 98.66 104.58 110.86 117.51 124.56
423.28 458.17 483.54 501.13 533.16 565.19 599.14 635.12
25.00 25.00 25.00 - - - - -
16.13 17.47 18.79 20.09 21.80 23.57 25.43 27.39
437.86 471.14 494.71 509.47 540.82 572.65 606.41 642.20
(55.71) (55.44) (54.97) (28.43) (29.45) (31.02) (32.70) (34.47)

731.31 823.43 914.74 1,004.64 1,089.94 1,178.30 1,271.37 1,369.46

529.98 562.45 584.61 594.77 629.18 665.72 704.49 745.62
437.86 471.14 494.71 509.47 540.82 572.65 606.41 642.20
823.43 914.74 1,004.64 1,089.94 1,178.30 1,271.37 1,369.46 1,472.88
 - - - - - - - -
321.62 353.78 382.09 405.01 429.31 455.07 482.37 511.32
696.01 770.31 837.00 892.60 946.16 1,002.93 1,063.10 1,126.89
1,017.63 1,124.09 1,219.09 1,297.61 1,375.47 1,458.00 1,545.48 1,638.21

662.10 725.11 792.81 863.73 938.08 1,016.10 1,098.05 1,184.18

- - - - - - - -
- - - - - - - -
662.10 725.11 792.81 863.73 938.08 1,016.10 1,098.05 1,184.18

1,679.73 1,849.20 2,011.90 2,161.34 2,313.55 2,474.10 2,643.53 2,822.38

224.48 279.91 334.88 363.31 392.77 423.79 456.49 490.96

446.98 494.69 537.53 573.23 607.62 644.08 682.73 723.69
100.07 100.07 100.07 100.07 100.07 100.07 100.07 100.07
771.52 874.67 972.47 1,036.61 1,100.46 1,167.94 1,239.28 1,314.72

50.00 25.00 - - - - - -
34.79 34.79 34.79 34.79 34.79 34.79 34.79 34.79

823.43 914.74 1,004.64 1,089.94 1,178.30 1,271.37 1,369.46 1,472.88

1,679.73 1,849.20 2,011.90 2,161.34 2,313.55 2,474.10 2,643.53 2,822.38

- - - - - - - -
1 1 1 1 1 1 1 1

64% 61% 58% 55% 53% 52% 51% 51%

2016 2017 2018 2019 2020 2021 2022 2023

25% 25% 25% 25% 25% 25% 25% 25%

25% 25% 25% 25% 25% 25% 25% 25%

2020 2021 2022 2023 2024 2025
0 0 0 0 0 0
0 0 0 0 0 0
0 0 0 0 0 0
 6% 6% 6% 6% 6% 6%
4% 4% 4% 4% 4% 4%
10% 10% 10% 10% 10% 10%

0.06 0.06 0.06 0.06 0.06 0.06

83.00% 83.00% 83.00% 83.00% 83.00% 83.00%

84% 84% 84% 84% 84% 84%
80% 80% 80% 80% 80% 80%

83% 83% 83% 83% 83% 83%

1.75% 1.75% 1.75% 1.75% 1.75% 1.75%

6% 6% 6% 6% 6% 6%

2% 2% 2% 2% 2% 2%

8.21% 8.21% 8.21% 8.21% 8.21% 8.21%

21.80% 21.80% 21.80% 21.80% 21.80% 21.80%

14% 14% 14% 14% 14% 14%

 3.50% 3.50% 3.50% 3.50% 3.50% 3.50%

3% 3% 3% 3% 3% 3%

8% 8% 8% 8% 8% 8%

6% 6% 6% 6% 6% 6%
1% 1% 1% 1% 1% 1%

86% 86% 86% 86% 86% 86%

6,601.65 6,997.75 7,417.62 7,862.67 8,334.43 8,834.50

5,479.37 5,808.13 6,156.62 6,526.02 6,917.58 7,332.63
115.53 122.46 129.81 137.60 145.85 154.60
122.18 129.51 137.28 145.51 154.24 163.50
12,318.73 13,057.85 13,841.32 14,671.80 15,552.11 16,485.23

2% 2% 2% 2% 2% 2%
132.03 139.96 148.35 157.25 166.69 176.69

28.90 28.90 28.90 28.90 28.90 28.90

6,601.65 6,997.75 7,417.62 7,862.67 8,334.43 8,834.50

8.21% 8.21% 8.21% 8.21% 8.21% 8.21%
542.00 574.52 608.99 645.53 684.26 725.31

21.8% 21.8% 21.8% 21.8% 21.8% 21.8%

1,194.50 1,266.17 1,342.14 1,422.67 1,508.03 1,598.51

14.00% 14.00% 14.00% 14.00% 14.00% 14.00%

767.11 813.14 861.93 913.64 968.46 1,026.57

100.07 100.07 100.07 100.07 100.07 100.07

 869.32 927.48 989.14 1,054.49 1,123.76 1,197.19
54.87 58.16 61.65 65.35 69.27 73.43

1,184.18 1,274.76 1,370.10 1,470.50 1,576.29 1,687.80

132.03 139.96 148.35 157.25 166.69 176.69
41.45 44.62 47.95 51.47 55.17 59.07
1,274.76 1,370.10 1,470.50 1,576.29 1,687.80 1,805.42

3.5% 3.5% 3.5% 3.5% 3.5% 3.5%

41.45 44.62 47.95 51.47 55.17 59.07

- - - - - -
- - - - - -

- - - - - -
- - - - - -
- - - - - -

34.79 34.79 34.79 34.79 34.79 34.79

1 1 1 1 1 1

8% 8% 8% 8% 8% 8%
- - - - - -

(490.96) (527.32) (565.70) (606.21) (649.00) (694.19)

(36.36) (38.38) (40.51) (42.78) (45.20) (47.76)
(527.32) (565.70) (606.21) (649.00) (694.19) (741.96)

- - - - - -
527.32 565.70 606.21 649.00 694.19 741.96

1% 1% 1% 1% 1% 1%
- - - - - -

6% 6% 6% 6% 6% 6%
 29.46 31.64 33.94 36.37 38.94 41.65

6,601.65 6,997.75 7,417.62 7,862.67 8,334.43 8,834.50

5,479.37 5,808.13 6,156.62 6,526.02 6,917.58 7,332.63
115.53 122.46 129.81 137.60 145.85 154.60
122.18 129.51 137.28 145.51 154.24 163.50
884.58 937.65 993.91 1,053.54 1,116.76 1,183.76
41.45 44.62 47.95 51.47 55.17 59.07
843.13 893.03 945.96 1,002.08 1,061.59 1,124.69
- - - - - -
29.46 31.64 33.94 36.37 38.94 41.65
- - - - - -
- - - - - -
813.67 861.39 912.01 965.70 1,022.65 1,083.04
24.41 25.84 27.36 28.97 30.68 32.49
789.26 835.55 884.65 936.73 991.97 1,050.55
- - - - - -
789.26 835.55 884.65 936.73 991.97 1,050.55

- - - - - -
789.26 835.55 884.65 936.73 991.97 1,050.55

884.58 937.65 993.91 1,053.54 1,116.76 1,183.76

54.87 58.16 61.65 65.35 69.27 73.43
24.41 25.84 27.36 28.97 30.68 32.49
805.30 853.65 904.90 959.22 1,016.80 1,077.84
132.03 139.96 148.35 157.25 166.69 176.69
673.26 713.69 756.54 801.97 850.12 901.15
- - - - - -
29.46 31.64 33.94 36.37 38.94 41.65
680.17 720.43 763.12 808.38 856.37 907.26
(36.36) (38.38) (40.51) (42.78) (45.20) (47.76)

1,472.88 1,581.97 1,697.10 1,818.64 1,946.99 2,082.58

789.26 835.55 884.65 936.73 991.97 1,050.55
680.17 720.43 763.12 808.38 856.37 907.26
1,581.97 1,697.10 1,818.64 1,946.99 2,082.58 2,225.87
 - - - - - -
542.00 574.52 608.99 645.53 684.26 725.31
1,194.50 1,266.17 1,342.14 1,422.67 1,508.03 1,598.51
1,736.50 1,840.69 1,951.13 2,068.20 2,192.29 2,323.83

1,274.76 1,370.10 1,470.50 1,576.29 1,687.80 1,805.42

- - - - - -
- - - - - -
1,274.76 1,370.10 1,470.50 1,576.29 1,687.80 1,805.42

3,011.26 3,210.79 3,421.63 3,644.48 3,880.09 4,129.25

527.32 565.70 606.21 649.00 694.19 741.96

767.11 813.14 861.93 913.64 968.46 1,026.57
100.07 100.07 100.07 100.07 100.07 100.07
1,394.50 1,478.90 1,568.21 1,662.71 1,762.72 1,868.59

- - - - - -
34.79 34.79 34.79 34.79 34.79 34.79

1,581.97 1,697.10 1,818.64 1,946.99 2,082.58 2,225.87

3,011.26 3,210.79 3,421.63 3,644.48 3,880.09 4,129.25

- - - - - -
1 1 1 1 1 1

50% 49% 49% 48% 48% 47%

2024 2025 2026 2027 2028 2029

25% 25% 25% 25% 25% 25%

25% 25% 25% 25% 25% 25%

 2008 2009

Revenues

No. of Stores 20 23

Increase in Revenue per store (%) -11.8%

Revenue per store (SAR Mn) 126.00 111.10

Revenues (SAR Mn) 2,519.92 2,555.31

Cost of Sales

Gross Profit Margin (%) 17.3% 19.0%

Cost of Sales (SAR Mn) 2,084.93 2,068.93

Selling & Distribution (S&D) Expenses

S&D Expenses as % of revenues (%) 1.4% 2.0%

Selling & Distribution Expenses (SAR Mn) 35.03 50.30

General & Administrative (G&A) Expenses

Inflation in G&A Expenses (%) 1.7%

G&A Expenses (SAR Mn) 50.73 51.61

Other Income

Other Income (SAR Mn) 5.25 13.65

 2010 2011 2012 2013 2014 2015

28 30 33 37 39 41

-3.1% 2.0% 2.0% 2.0% 2.0% 2.0%

107.66 109.82 112.01 114.25 116.54 118.87

3,014.57 3,184.67 3,528.40 3,998.85 4,428.44 4,754.75

16.6% 17.0% 18.0% 19.0% 19.0% 19.0%

2,512.99 2,643.28 2,893.29 3,239.07 3,587.04 3,851.35

1.7% 1.7% 1.7% 1.7% 1.7% 1.7%

50.11 54.14 59.98 67.98 75.28 80.83

8.1% 5.0% 5.0% 5.0% 5.0% 5.0%

55.79 58.58 61.51 64.58 67.81 71.20

28.90 - - - - -
Amounts in SAR Millions 2008 2009 2010

Revenues 2,519.92 2,555.31 3,014.57

Cost of Sales (2,084.93) (2,068.93) (2,512.99)
Gross Profit 434.99 486.38 501.58

Selling & Distribution Expenses (35.03) (50.30) (50.11)

General & Administration Expenses (50.73) (51.61) (55.79)

Net Operating Income (EBIT) 349.22 384.46 395.68

Financial Charges (12.95) (13.49) (11.41)

Other Income 5.25 13.65 28.90

Net Income Before Zakat (EBT) 341.52 384.62 413.16

Zakat & Taxes 2.5% (8.75) (10.65) (12.42)

Net Income (PAT) 332.77 373.97 400.74

13% 15% 13%
 2011 2012 2013 2014 2015

3,184.67 3,528.40 3,998.85 4,428.44 4,754.75

(2,643.28) (2,893.29) (3,239.07) (3,587.04) (3,851.35)
541.39 635.11 759.78 841.40 903.40

(54.14) (59.98) (67.98) (75.28) (80.83)

(58.58) (61.51) (64.58) (67.81) (71.20)

428.68 513.62 627.22 698.31 751.37

(10.00) (6.67) (4.00) (1.33) -

- - - - -

418.67 506.95 623.22 696.97 751.37

(10.47) (12.67) (15.58) (17.42) (18.78)

408.20 494.28 607.64 679.55 732.58

13% 14% 15% 15% 15%
Amounts in SAR Millions 2008 2009

Cash & Bank Balances 60.41 75.52

Accounts Receivable 189.75 218.02
Inventories 390.83 421.42
Current Assets 640.99 714.97

Fixed Assets 521.93 535.44

Non-Current Assets 521.93 535.44

Total Assets 1,162.92 1,250.42

Bank Loans - Current 42.03 37.05

Accounts Payable 190.14 277.06
Other Payables 60.65 68.22
Current Liabilities 292.82 382.34

Bank Loans - Non current 150.00 100.00

EOSB 33.23 45.24
Non-Current Liabilities 183.23 145.24

Share Capital 300.00 400.00

Retained Earnings 386.87 322.84
Net Worth 686.87 722.84

Total Liabilities & Net Worth 1,162.92 1,250.42

A-L - -
 2010 2011 2012 2013 2014 2015

87.87 48.98 144.55 321.94 581.30 937.88

247.52 280.24 303.47 340.27 380.96 415.13
543.05 635.70 682.59 756.04 841.57 917.06
878.43 964.93 1,130.61 1,418.25 1,803.84 2,270.07

555.02 551.26 555.70 568.06 561.92 555.24

555.02 551.26 555.70 568.06 561.92 555.24

1,433.45 1,516.19 1,686.31 1,986.32 2,365.75 2,825.31

50.11 33.33 33.33 33.33 - -

350.90 395.55 424.72 470.43 523.65 570.62
100.07 100.07 100.07 100.07 100.07 100.07
501.08 528.95 558.12 603.83 623.71 670.68

100.00 66.67 33.33 - - -

34.79 34.79 34.79 34.79 34.79 34.79
134.79 101.45 68.12 34.79 34.79 34.79

400.00 400.00 400.00 400.00 400.00 400.00

397.58 485.79 660.07 947.70 1,307.25 1,719.84
797.58 885.79 1,060.07 1,347.70 1,707.25 2,119.84

1,433.45 1,516.19 1,686.31 1,986.32 2,365.75 2,825.31

- - - - - -
 2008

Net Income (PAT)

Depreciation
ESOB
Gain on Sale of Fixed Assets
Net Increase in Working Capital
Net cash from Operating Activities

Investment in Fixed Assets

Proceeds from sale of Fixed Assets
Net cash used in Investing Activities

Borrowings
Dividends 80%
Net cash from/used in Financing Activities

Increase/Decrease in Cash

Opening Cash Balance at the beginning of the year

Closing Cash Balance at the end of the year

Check

FCFE

FCFF
 2009 2010 2011 2012 2013 2014

373.97 400.74 408.20 494.28 607.64 679.55

18.36 19.40 21.47 22.13 23.06 23.86
12.01 (10.45) - - - -
0.33 0.07 - - - -
35.62 (45.43) (80.73) (40.94) (64.55) (73.00)
440.29 364.32 348.94 475.47 566.14 630.41

(31.88) (38.97) (17.71) (26.57) (35.43) (17.71)

(0.32) (0.06) - - - -
(32.20) (39.04) (17.71) (26.57) (35.43) (17.71)

(54.97) 13.06 (50.11) (33.33) (33.33) (33.33)

(338.00) (326.00) (320.00) (320.00) (320.00) (320.00)
(392.97) (312.94) (370.11) (353.33) (353.33) (353.33)

15.12 12.34 (38.88) 95.57 177.39 259.36

60.41 75.52 87.87 48.98 144.55 321.94

75.52 87.87 48.98 144.55 321.94 581.30

- - - - - -

281.12 415.57 497.39 579.36

340.98 455.57 569.72 628.23

 2015

732.58
24.39
-
-
(62.69)
694.29

(17.71)
-
(17.71)

-
(320.00)
(320.00)

356.57

581.30

937.88

676.57

676.57
 2008

Opening Gross Block

Additions 8.86
Disposals
Closing Gross Block

Accumulated depreciation at the beginning of the year

Depreciation during the year on assets held at end of year 3%
Depreciation during the year on assets sold during the year
Depreciation during the year
Accumulated depreciation at the end of the year

Closing Net Block 521.93

 2009 2010 2011 2012 2013 2014 2015

637.01 667.97 706.75 724.46 751.03 786.46 804.17

31.88 38.97 17.71 26.57 35.43 17.71 17.71
(0.92) (0.19) - - - - -
667.97 706.75 724.46 751.03 786.46 804.17 821.88

(115.08) (132.52) (151.73) (173.20) (195.33) (218.39) (242.25)

(18.36) (19.40) (21.47) (22.13) (23.06) (23.86) (24.39)
0.91 0.19
(17.44) (19.21) (21.47) (22.13) (23.06) (23.86) (24.39)
(132.52) (151.73) (173.20) (195.33) (218.39) (242.25) (266.64)

535.44 555.02 551.26 555.70 568.06 561.92 555.24

Amounts in SAR Millions 2008 2009 2010

Opening Balance 192.03 137.05

Additions 13.06
Repayments 3 54.97
Closing Balance 192.03 137.05 150.11
Interest cost (%) 8.0% 12.95 13.49 11.41

Current 42.03 37.05 50.11

Non-Current 150.00 100.00 100.00
 2011 2012 2013 2014 2015

150.11 100.00 66.67 33.33 -

- - - - -
50.11 33.33 33.33 33.33 -
100.00 66.67 33.33 - -
10.00 6.67 4.00 1.33 -

33.33 33.33 33.33 - -

66.67 33.33 - - -
 2008 2009

Accounts Receivables

Number of Days of Revenues 31.36

Accounts Receivables 189.75 218.02

Inventories

Number of Days of COS 74.06

Inventories 390.83 421.42

Accounts Payables

Number of Days of COS 48.69

Accounts Payables 190.14 277.06

Other Payables

Number of Days of COS 11.99

Other Payables 60.65 68.22

 2010 2011 2012 2013 2014 2015

32.44 33.00 33.00 33.00 33.00 33.00

247.52 280.24 303.47 340.27 380.96 415.13

86.52 90.00 90.00 90.00 90.00 90.00

543.05 635.70 682.59 756.04 841.57 917.06

55.91 56.00 56.00 56.00 56.00 56.00

350.90 395.55 424.72 470.43 523.65 570.62

15.94 16.00 16.00 16.00 16.00 16.00

100.07 113.01 121.35 134.41 149.61 163.03

 2008

Cost of Equity

Rf 3.60%
Rm 14.10%
Beta 0.70
Ke 10.95%

g 3%

FCFE Valuation

No. of Years into future

FCFE

Terminal Value

PV(FCFE-1)
PV(FCFE-2)
PV(FCFE-3)
PV(FCFE-4)
PV(FCFE-5)
Sum(PV(FCFE))

PV(TV)

Equity Valuation

No. of shares (Mn) 40.00

Share Price

Sensitivity Analysis

WACC
Rf 3.60%
Rm 14.10%
Beta 0.70
Ke 10.95%
Kd 8.00%
Kd*(1-t) 7.80%
D/(D+E) 0.03
WACC 10.86%

g 3%

FCFF Valuation

No. of Years into future

FCFF

Terminal Value

PV(FCFF-1)
PV(FCFF-2)
PV(FCFF-3)
PV(FCFF-4)
PV(FCFF-5)
Sum(PV(FCFF))

PV(TV)

Enterprise Valuation (SAR Mn)

Net Debt (SAR Mn)

Equity Valuation

No. of shares (Mn) 40.00

Share Price

Sensitivity Analysis
 2009 2010 2011 2012 2013 2014

1.00 2.00 3.00 4.00

- - 281.12 415.57 497.39 579.36

253.37
337.59
364.18
382.33
402.42
1,739.89

5,213.73

6,953.62

173.84

Ke
173.84 9.95% 10.45% 10.95% 11.45%
2.0%
2.5%
g 3.0%
3.5%
4.0%
 1.00 2.00 3.00 4.00

340.98 455.57 569.72 628.23

307.33
370.08
417.14
414.58
402.42
1,911.55

5,291.27

7,202.83

62.25

7,140.58

178.51

Ke
178.51 9.86% 10.36% 10.86% 11.36%
2.0%
2.5%
g
g 3.0%
3.5%
4.0%
 2015

5.00

676.57

8,765.67

11.95%
 5.00

676.57

8,861.59

11.86%
P/E Multiple EV/EBITDA Multiple
Trailing P/E
Company 1 (BBY) 10.5
Company 2 (SPLS) 16.7
Company 3 (OMX) 14.5
Company 4 (RSH) 10.0
Average 12.9

PAT of XYZ in 2010 (SAR Mn) 400.74

Equity Valuation of XYZ (SAR Mn) 5,179.62

No. of Shares 40.00

Share Price 129.49

EV/EBITDA Multiple
Mcap Debt EV EBITDA EV/EBITDA
Company 1 (BBY) 12,590 2,892 15,482 3,092 5.0
Company 2 (SPLS) 14,570 2,601 17,171 2,072 8.3
Company 3 (OMX) 779 1,740 2,519 247 10.2
Company 4 (RSH) 1,730 639 2,369 459 5.2
Average 7.2

EBITDA of XYZ in 2010 (SAR Mn) 815.82

EV (SAR Mn) 5,840.59

Net Debt (SAR Mn) 62.25

Equity Valuation of XYZ (SAR Mn) 5,778.34

No. of Shares 40.00

Share Price 144.46

Method Valuation Weight
DCF 173.84 50%
P/E 129.49 25%
EV/EBITDA 144.46 25%

Blended Valuation 155.41