Appendix

Financials
Income Statement
Year 1

Year

M1

Revenues
Product 1 (Mud Grade)
Product 2 (Detergent Grade)
Product 3 (Edible Grade)
Total Revenue

Cost of Goods Sold

Raw Material Cost
Direct Labour (ref. headcount Sheet)
Plant Depreciation (ref. depreciation table)
Total CGS

Gross Profit

M2

M3

Sales / Marketing
Maintenance / modifications
Depreciation (see depreciation table)
Payroll (ref. headcount sheet)
General and administrative overheads
Total Expenses
Net Profit from operations

7
6

Net Profit %

Year 2
Q1

Q2

(7,500)
(83)
(11,200)
(400)
(19,183)
(19,183)
0.00%

Tax @ 21% / 28%

Total Earnings from operations after tax
Total Earnings

Total Year 1

Q4

0.00%

R&D

Q3

Gross Profit %

Q2

4,029
(15,155)
(15,155)

0.00%

(2,500)
(83)
(11,200)
(400)
(14,183)
(14,183)
0.00%
2,979
(11,205)
(11,205)

0.00%
(2,500)
(83)
(11,200)
(400)
(14,183)
(14,183)
0.00%
2,979
(11,205)
(11,205)

0.00%

0.00%

(2,500)
(250)
(36,600)
(1,200)
(40,550)
(40,550)
0.00%
8,516
(32,035)
(32,035)

(250)
(40,500)
(1,200)
(41,950)
(41,950)
0.00%

(250)
(40,500)
(1,200)
(41,950)
(41,950)
0.00%

8,810
(33,141)
(33,141)

0.00%

8,810
(33,141)
(33,141)

0.00%
(15,000)
(1,000)
(151,200)
(4,800)
(172,000)
(172,000)
0.00%
36,120
(135,880)
(135,880)

0.00%
(250)
(40,500)
(1,200)
(41,950)
(41,950)
0.00%
8,810
(33,141)
(33,141)

Notes to the Income Statement:

1 Revenue is generated at the following rates:
- Product 1: 1/kg
- Product 2: 2/kg
- Product 3: 2.5/kg
2 The Cost and quantity of raw materials used in production comprise of:
- Product 1: 0.29/kg
- Product 2: 0.34/kg
- Product 3: 1.17/kg
3 For Depreciation charges and rates, refer to the Depreciation Table
4 R & D cost in the first year is for mud grade, the ones in year two and three are for detergent grade and edible grade.
5 Salaries of the CEO, CFO and chemical engineers have been deferred until the company has started its operations because each of these have 20% stake in the company
6 General and administrative overheads include the cost of office that will be rented in Cardiff for our headoffice.
7 For details with reference to the payroll, refer to the headcount sheet.
5 On years of losses, for simplicity purposes, a tax rebate has been allowed for. In reality, the UK Corporation Tax rules for opening year losses would apply. Also, a rebate of upto 200% of
qualifying expenditure would also be available.

Q3

Total Year 2

Q4

540,000
540,000

540,000
540,000

(9,900)
(9,900)

(158,042)
(9,900)
(563)
(168,505)

(158,042)
(19,800)
(563)
(178,405)

0.00%

(9,900)
0.00%

(250)
(47,100)
(1,200)
(48,550)
(48,550)
0.00%
10,196
(38,355)
(38,355)

(250)
(50,100)
(1,200)
(51,550)
(61,450)
0%

371,496
68.80%
(7,500)
(3,000)
(2,000)
(250)
(51,300)
(1,200)
(65,250)
306,246
56.71%

12,905
(48,546)
(48,546)

(64,312)
241,934
241,934

361,596
66.96%
(7,500)
(3,000)
(2,000)
(1,000)
(189,000)
(4,800)
(207,300)
154,296
28.57%
(32,402)
121,893
121,893

Year 3

2,160,000
500,000
2,660,000
(800,000)
(49,200)
(2,250)
(851,450)
1,808,550
67.99%
(22,500)
(12,000)
(10,000)
(1,000)
(222,000)
(4,800)
(272,300)
1,536,250
57.75%
(430,150)
1,106,100
1,106,100

Year 4

Year 5

2,160,000
600,000
200,000
2,960,000

2,160,000
750,000
250,000
3,160,000

(950,000)
(69,600)
(2,250)
(1,021,850)

(1,050,000)
(69,600)
(2,250)
(1,121,850)

1,938,150
65.48%
(12,000)
(10,000)
(1,000)
(264,000)
(4,800)
(291,800)
1,646,350
55.62%
(460,978)
1,185,372
1,185,372

2,038,150
64.50%
(12,000)
(10,000)
(1,000)
(264,000)
(4,800)
(291,800)
1,746,350
55.26%
(488,978)
1,257,372
1,257,372

Year

Year

Year 1
M1

M2

M3

M1

M2

M3

Q2

Q3

Q4

Q2

Q3

Q4

Total Year 1

Year 1

Total Year 1

Year 2
Q1

Q2

Q1

Q2

Q3

Q4

Q3

Q4

Year 2

Total Year 2

Year 3

Year 4

Year 5

Total Year 2

Year 3

Year 4

Year 5

Balance Sheet
Cash (at year end) (see cashflow statement)
1
Accounts Receivables
Fixed Assets (see depreciation table)
Total Assets

390,929
104,917
495,845

390,807
104,833
495,640

390,686
104,750
495,436

384,401
112,000
496,401

377,011
119,250
496,261

369,620
126,500
496,120

369,620
126,500
496,120

362,230
133,750
495,980

353,225
141,000
494,225

322,330
148,250
470,580

338,576
147,438
486,013

2
Accounts Payable
Deferred Salaries (ref. headcount sheet)
Short-term Notes
Interest free government grant
Total Liabilities

11,000
450,000
461,000

22,000
450,000
472,000

33,000
450,000
483,000

66,000
450,000
516,000

99,000
450,000
549,000

132,000
450,000
582,000

132,000
450,000
582,000

165,000
450,000
615,000

201,600
450,000
651,600

226,500
450,000
676,500

450,000
450,000

450,000
450,000

450,000
450,000

Capital Stock (see cap table appendix 3)

Retained Earnings
Net Income
Total Equity

50,000
(15,155)
34,845

50,000
(15,155)
(11,205)
23,640

50,000
(26,360)
(11,205)
12,436

50,000
(37,565)
(32,035)
(19,599)

50,000
(69,599)
(33,141)
(52,740)

50,000
(102,740)
(33,141)
(85,880)

50,000
(135,880)
(85,880)

50,000
(135,880)
(33,141)
(119,021)

50,000
(169,021)
(38,355)
(157,375)

50,000
(207,375)
(48,546)
(205,921)

50,000
(255,921)
241,934
36,013

50,000
(135,880)
121,893
36,013

Total Liabilities and Equity

495,845

495,640

495,436

496,401

496,261

496,120

496,120

495,980

494,225

470,580

486,013

486,013

Gearing [Debt / (Debt + Equuity)]

Return on Capital Employeed (Profit before Tax / Capital Employed)
Profit before Tax
Capital Employed
ROCE

92.81%

95.01%

97.31%

104.55%

113.28%

123.59%

123.59%

135.96%

153.78%

184.37%

(19,183)
484,845

(14,183)
473,640

(14,183)
462,436

(40,550)
430,401

(41,950)
397,261

(41,950)
364,120

(172,000)
364,120

(41,950)
330,980

(48,550)
292,625

(61,450)
244,080

-3.96%

-2.99%

-3.07%

-9.42%

-10.56%

-11.52%

-47.24%

-12.67%

-16.59%

-25.18%

338,576
147,438
486,013
-

1,447,926
144,188
1,592,113
-

2,636,548
140,938
2,777,485
-

3,897,170
137,688
4,034,857
-

450,000
450,000

450,000
450,000

50,000
(13,987)
1,106,100
1,142,113

50,000
1,092,113
1,185,372
2,327,485

50,000
2,277,485
1,257,372
3,584,857

1,592,113

2,777,485

4,034,857

92.59%

92.59%

28.26%

16.20%

11.15%

306,246
486,013
63.01%

154,296
486,013
31.75%

1,536,250
1,592,113
96.49%

1,646,350
2,777,485
59.27%

1,746,350
4,034,857
43.28%

Year 1

Year

M1

M2

M3

M1

M2

M3

Q2

Q3

Q4

Q2

Q3

Q4

Total Year 1

Year 1

Year

Total Year 1

Year 2
Q1

Q2

Q1

Q2

Q3

Q4

Q3

Q4

Year 2

Total Year 2

Year 3

Year 4

Year 5

Total Year 2

Year 3

Year 4

Year 5

Cashflow Statement
Beginning Cash
Cash from Sales
Investment
Direct Material Cost
Payroll expense (including overtime)
Direct
Indirect
R&D
Overheads
Payment of deferred salaries (ref. headcount sheet)
Other expenses
Construction / Erection Cost
Fixed Assets
Tax Rebate / (Payment)
Ending Cash

500,000
-

(105,000)
4,029
390,929

Cashflow for the year

(109,072)

(200)
(7,500)
(400)
-

Payback Period
Y1
Y2
Y3
Y4
Y5
Payback period

390,929
(200)
(2,500)
(400)
2,979
390,807
(122)

Cashflows
Accumulated Cashflows
(130,380)
(130,380)
(31,044)
(161,424)
1,109,350
947,926
1,188,622
2,136,548
1,260,622
3,397,170
2 years, 5 months, 13 days

390,807
-

390,686
-

(200)
(2,500)
(400)
2,979
390,686
(122)

384,401
-

377,011
-

(3,600)
(2,500)
(1,200)
-

(7,500)
(1,200)
-

(7,500)

(7,500)
8,516
384,401

(7,500)
8,810
377,011

(6,285)

(7,391)

500,000
-

369,620
-

362,230
-

353,225
-

322,330
540,000
(158,042)

369,620
540,000
(158,042)

338,576
2,660,000
(800,000)

1,447,926
2,960,000
(950,000)

2,636,548
3,160,000
(1,050,000)

(7,500)

(10,500)

(9,900)
(25,200)

(19,800)
(94,500)
(7,500)
(4,800)
(226,500)
(5,000)
(22,500)
(32,402)
338,576

(49,200)
(222,000)
(22,500)
(4,800)

(69,600)
(264,000)
(4,800)

(69,600)
(264,000)
(4,800)
(22,000)

(31,044)

(1,200)
-

(1,200)
-

(1,200)
-

(7,500)
8,810
369,620

(19,200)
(15,000)
(4,800)
(22,500)
(105,000)
36,120
369,620

(7,500)
8,810
362,230

(7,500)
10,196
353,225

(7,500)
12,905
322,330

(9,900)
(51,300)
(7,500)
(1,200)
(226,500)
(5,000)
(64,312)
338,576

(7,391)

(130,380)

(7,391)

(9,005)

(30,896)

16,246

(1,200)
-

1,109,350
12 months
x months

1,109,350
500,000

x months = 5.408572588
0.408572588

12.25717763 months

(22,000)

(22,000)
-

(430,150)
1,447,926

(460,978)
2,636,548

(488,978)
3,897,170

1,109,350

1,188,622

1,260,622

Appendix 2
Head count
Year 1

Staff
Indirect

Indirect

Indirect

M1

M2

M3

Q2

Q3

Total Year 1

Q4

Year 2
Q1

Q2

Q3

1
4,000

1
4,000

1
12,000

1
12,000

1
12,000

48,000

1
12,000

1
12,000

1
12,000

1
12,000

48,000

1
48,000

1
48,000

Chemical Engineers @ 2500 per month

Total expense

2
5,000

2
5,000

2
5,000

2
15,000

2
15,000

2
15,000

60,000

2
15,000

2
15,000

2
15,000

2
15,000

60,000

2
60,000

3
90,000

1
2,000

1
2,000

1
2,000

1
6,000

1
6,000

1
6,000

24,000

1
6,000

1
6,000

1
6,000

1
6,000

24,000

1
24,000

1
24,000

Shift Engineer @ 400 per month

Total expense

2
2,400

2
2,400

4,800

3
14,400

4
19,200

Production Manager @ 600 per month

1
1,800

1
1,800

3,600

1
1,800

1
1,800

1
1,800

1
1,800

3,600

1
1,800

1
1,800

1
900

1
900

1,800

2
7,200

3
10,800

1
3,600

1
1,800

1
1,800

7,200

1
7,200

1
7,200

1
1,200

1
1,200

1
1,200

3,600

1
4,800

1
4,800

3
1,800

6
3,600

8
4,800

10,200

10
24,000

10
24,000

5
3,000

5
3,000

5
3,000

5
3,000

12,000

10
24,000

15
36,000

10
3,000

10
3,000

6,000

20
24,000

30
36,000

24,000

25
30,000

25
30,000
96

CFO @ 2000 per month

Total expense

Marketing Manager @ 600 per month

HR & Admin Manager @ 400 per month

Indirect

Marketing & Sales staff @ 200 per month

Indirect

Operators @ 200 per month

Helpers @ 100 per month

5
3,000

5
3,000

5
3,000

9,000

Indirect

Year 4

1
4,000

Quality Control Engineer @ 300 per month

Indirect

Year 3

CEO (Head R & D) @ 4000 per month

Total expense

Quality Control Manager @ 600 per month

Indirect

Total Year 2

Q4

Administrative / Personnel Staff @ 100 per month

2
200

2
200

2
200

2
600

15
4,500

15
4,500

Total No. of Employees

11

24

Total Permanent Employees

Total Payroll expenditure

11,200

11,200

11,200

Indirect Labour
Direct Labour

11,200
-

11,200
-

11,200
-

deferred salaries
Total Payroll
Cashflow

11,000
11,200
200

11,000
11,200
200

11,000
11,200
200

Total Contract Employees

15
4,500

15
4,500

25
7,500

25
7,500

24

24

29

57

59

78

57

59

78

36,600

40,500

40,500

151,200

40,500

36,600
-

40,500
-

40,500
-

151,200
-

40,500
-

33,000
36,600
3,600

33,000
40,500
7,500

33,000
40,500
7,500

132,000
151,200
19,200

33,000
40,500
7,500

10,200

Beginning from the first quarter, one sweeper and one office assistant are contract employees.
Salaries of CEO, 2 Engineers, CFO and Marketing Manager are deferred. Current amount is only for one office assistant and a sweeper.
Admin. Staff avg. salary taken @ 100 total 15 employees in first month of Q3 and then 25 onwards.

96

47,100

60,000

61,200

208,800

271,200

333,600

47,100
-

50,100
9,900

51,300
9,900

189,000
19,800

222,000
49,200

264,000
69,600

36,600
47,100
10,500

34,800
60,000
25,200

34,800
61,200
26,400

208,800

271,200

333,600

Year 5
1
48,000
3
90,000
1
24,000
4
19,200
1
1,800
1
1,800
3
10,800
1
7,200
1
4,800
10
24,000
15
36,000
30
36,000
25
30,000
96
96

333,600
264,000
69,600

333,600

Depreciation Table

Rate od Depreciation
Office Equipment
Plant
Land

20%
5%
0%

Year 1

Year 2

Month 1
Opening
Office Equipment
Plant
Land

Cost
Additions
5,000
100,000
105,000

Closing

Depreciation
Charge

Closing

83
-

83
-

Net Book
Value
4,917
100,000
104,917

Opening
Office Equipment
Plant
Land

5,000
100,000

Cost
Additions
-

Closing
5,000
100,000

Month 2
Opening
Office Equipment
Plant
Land

5,000
100,000

Opening
Office Equipment
Plant
Land

5,000
100,000

Cost
Additions
-

Cost
Additions
-

Closing

Depreciation
Charge

83
-

83
-

Month 3 / Total Quarter 1

Depreciation
Opening
Charge

Closing

5,000
100,000

167
-

83
-

Closing
167
-

Net Book
Value
4,833
100,000
104,833

Opening
Office Equipment
Plant
Land

5,000
100,000

Cost
Additions
-

Closing
5,000
100,000

5,000
100,000

Cost
Additions
-

Closing

250
-

Net Book
Value
4,750
100,000
104,750

Opening
Office Equipment
Plant
Land

5,000
100,000

Cost
Additions
-

Closing
5,000
100,000

250
-

Depreciation
Charge
250
-

Closing
500
-

Net Book
Value
4,500
100,000
104,500
7,500
112,000

Opening
Office Equipment
Plant
Land

5,000
100,000

Cost
Additions
-

Closing

5,000
0
100,000

500
-

Depreciation
Charge
250
-

Closing
750
-

Net Book
Value
4,250
100,000
104,250
15,000
119,250

Opening
Office Equipment
Plant
Land

5,000
0
100,000

Capital Work in Progress (Plant)

Quarter 4
Opening
Office Equipment
Plant
Land

5,000
100,000

Cost
Additions
-

Closing

Opening

5,000
100,000

750
-

Depreciation
Charge
250
-

Closing
1,000
-

Net Book
Value
4,000
100,000
104,000
22,500
126,500

Capital Work in Progress (Plant)

Year 1 (Total)
Opening
Office Equipment
Plant
Land

5,000
100,000

Cost
Additions
-

Closing
5,000
100,000

Closing
1,250
-

Net Book
Value
3,750
100,000
103,750
30,000
133,750

Opening
1,250
-

Depreciation
Charge
250
-

Closing
1,500
-

Opening
Office Equipment
Plant
Land

5,000
45,000
100,000

Cost
Additions
-

Closing
5,000
45,000
100,000

3,500
100,000
103,500
37,500
141,000

Opening
1,500
-

Depreciation
Charge
250
-

Closing
1,750
-

Opening
-

Depreciation
Charge
1,000
-

Opening
Office Equipment
Plant
Land

Cost
Additions

45,000

Closing
5,000
45,000
100,000

Opening
1,750
-

Depreciation
Charge
250
563
813

Closing
2,000
563
-

Net Book
Value
3,000
44,438
100,000
147,438

Closing
1,000
-

Net Book
Value
4,000
100,000
104,000
22,500
126,500

Capital Work in Progress (Plant)

Cost
Additions

45,000

Closing
5,000
45,000
100,000

Opening
1,000
-

Depreciation
Charge
1,000
563
1,563

Closing
2,000
563
-

Net Book
Value
3,000
44,438
100,000
147,438

2,000
563
-

1,000
2,250
3,250

3,000
2,813
-

Net Book
Value
2,000
42,188
100,000
144,188

5,000
45,000
100,000

Cost
Additions
-

Closing
5,000
45,000
100,000

Year 4 (Total)
Depreciation
Opening
Charge Closing
3,000
2,813
-

1,000
2,250
3,250

4,000
5,063
-

Net Book
Value
1,000
39,938
100,000
140,938

Capital Work in Progress (Plant)

Net Book
Value
3,250
100,000
103,250
45,000
148,250

Year 3 (Total)
Depreciation
Opening
Charge Closing

Capital Work in Progress (Plant)

Net Book
Value

Year 2 (Total)

Opening

5,000
100,000

250
-

Capital Work in Progress (Plant)

Quarter 3
Opening
Office Equipment
Plant
Land

Depreciation
Charge

Quarter 4

Opening

5,000
100,000

1,000
-

Quarter 3
Closing

Quarter 2
Opening
Office Equipment
Plant
Land

Opening

Quarter 2

Opening

5,000
100,000

Y e a r 3, 4 & 5

Quarter 1

Opening

5,000
100,000

Opening
Office Equipment
Plant
Land

5,000
45,000
100,000

Capital Work in Progress (Plant)

Cost
Additions
-

Closing
5,000
45,000
100,000

Year 5 (Total)
Depreciation
Opening
Charge Closing
4,000
5,063
-

1,000
2,250
-

5,000
7,313
-

Net Book
Value
37,688
100,000
137,688

Appendix 5

Key Milestones and Product Development Schedule

Item / Activity
R&D
ChemTec1

Plant

Sales &
Marketing
Construction &
Erection
R&D

ChemTec2

Sales &
Marketing
R&D

ChemTec3

Sales &
Marketing

Q1

Year 1
Q2

Q3

Q4

Q5

Year 2
Q6
Q7

Q8

Q9

Year 3
Q10
Q11

Q12

Q13

Year 4
Q14
Q15

Appendix 5

roduct Development Schedule

Year 4
Q16

NaoH calculation
Investment Outlay (Million Rs.)

40.00
Price per ton is $500 which is 319.43

Per Ton
NaoH
Monochloro Acetic Acid
Cotton Linters
Ethyl Alcohol

Price
319.43
384.00
12.50
1,600.00

R.M Cost per Ton

Planned Plant Capacity

Consumption
0.17
0.39
0.67

Cost
54.30
150.00
8.37
80.00
292.67

Ton per Year

Ton per Day
Ton per month

2000
6
180

319.43 x 0.17 = 54.3

Price per ton : $600 or 384
2000rs/ton
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