Note: All values are in $ Million

Twenty-First Century Fox, Inc.

5-Year DCF (FCF) Model

Summary

Cost of Capital 13.4%

Terminal Growth Rate 4.7%

5-Yr Period
Revenue 5Y CAGR 0.7%
EBITDA 5Y CAGR -0.7%
Unlevered FCF 5Y CAGR -3.0%

5Y Average EBITDA Margin 22.4%

5Y Average Unlevered FCF Margin 16.9%

Enterprise Value 74,628

Cost Synergies 2,000
Value of Acquisition 76,628

Revenue and EBITDA Forecast

Input Projections
Fiscal Years Ending Jun-17 Jun-18 Jun-19 Jun-20

Revenue 28,500 28,710 28,922 29,135

% Growth 4.3% 0.7% 0.7% 0.7%

EBITDA 6,858 6,441 6,489 6,536

% of Revenue 24.1% 22.4% 22.4% 22.4%

Capital Expenditures Forecast

Input Projections
Fiscal Years Ending Jun-17 Jun-18 Jun-19 Jun-20

Capital Expenditures 377 466 470 473

% of Revenue 1.3% 1.6% 1.6% 1.6%

Fiscal Years Ending

Historical Spending Jun-13 Jun-14 Jun-15 Jun-16

Capital Expenditures 622 678 424 263

% of Revenue 2.2% 2.1% 1.5% 1.0%
5-Year Average 1.6%

Net Working Capital Forecast

Input Projections
Fiscal Years Ending Jun-17 Jun-18 Jun-19 Jun-20

Net Working Capital 3,342 2,379 2,397 2,415

% of Revenue 11.7% 8.3% 8.3% 8.3%

NWC Investment 963 (18) (18)

Fiscal Years Ending

Historical Spending Jun-13 Jun-14 Jun-15 Jun-16

Total Current Assets 15,567 15,376 17,348 14,949

(-) Cash and Equivalents (6,659) (5,415) (8,428) (4,424)
(-) Short Term Investments 0 0 0 0
(-) Total Current Liab. (8,435) (8,856) (7,042) (7,068)
(+) Current Portion of Debt 137 799 244 427
Net Working Capital 610 1,904 2,122 3,884
% of Revenue 2.2% 6.0% 7.3% 14.2%
Average 8.3%

NWC Investment (1,294) (218) (1,762)

Depreciation & Amortization Forecast

Input Projections
Fiscal Years Ending Jun-18 Jun-19 Jun-20

Depreciation & Amortization 818 824 830

% of Revenue 2.8% 2.8% 2.8%

Fiscal Years Ending

Historical Spending Jun-13 Jun-14 Jun-15 Jun-16

Depreciation & Amortization 886 1,227 816 605

% of Revenue 3.2% 3.9% 2.8% 2.2%
Average 2.8%

Pro forma Tax Rate

Fiscal Years Ending

Historicals Jun-13 Jun-14 Jun-15 Jun-16

Income Before Taxes 8,736 5,189 9,847 4,154

Income Taxes (1,690) (1,272) (1,243) (1,130)
Effective Tax Rate 19.3% 24.5% 12.6% 27.2%
5-Year Average 22.8%

Selected Tax Rate Assumption 23.0%

Discount Rate and Growth Rate

Discount Rate 13.4%

Growth Rate 4.7%

Supporting Calculations

Calculation of Free Cash Flow

Projected Unlevered Cash Flow

Jun-18 Jun-19 Jun-20

EBITDA 6,441 6,489 6,536

D&A (818) (824) (830)

EBIT 5,623 5,664 5,706

Pro forma Taxes (1,293) (1,303) (1,312)
NOPAT 4,330 4,362 4,394

Capital Expenditures (466) (470) (473)

NWC Investment 963 (18) (18)
(+) D&A 818 824 830

Free Cash Flow 5,644 4,698 4,733

% Growth -17% 1%
Calculation of Enterprise Value

FCF PV of FCF

Jun-18 5,644 4,976

Jun-19 4,698 3,652
Jun-20 4,733 3,243
Jun-21 4,768 2,880
Jun-22 4,803 2,558

(A) PV of Discrete Cash Flows 17,309

Terminal FCF 4,803

Terminal Discount Factor 4.7%

(B) PV of Terminal Value 57,319

(A + B) Enterprise Value 74,628

Historical Financials

Fiscal Years Ending

Jun-13 Jun-14 Jun-15 Jun-16

Revenue 27,675 31,867 28,987 27,326

Growth 15.1% -9.0% -5.7%
CAGR 0.7%

Cost of Revenue (17,496) (21,108) (18,561) (17,129)

Gross Profit 10,179 10,759 10,426 10,197

R&D Expense 0 0 0 0
SG&A Expense (4,007) (4,129) (3,784) (3,675)
Other Expenses / (Income) (18,293) (22,250) (19,799) (17,982)
Total Operating Expenses (22,300) (26,379) (23,583) (21,657)

EBIT 5,375 5,488 5,404 5,669

(+) D&A 886 1,227 816 605

(+) Asset Writedown 0 0 0 0
(+) Restructuring 0 0 0 0
(+) Merger / Acq Exp 0 0 0 0
(+) Goodwill Impairment 0 0 0 0
(+) Litigation 0 0 0 0
(+) Other Non-recurring 0 0 0 0
Adjusted EBITDA 6,261 6,715 6,220 6,274
% Margin 22.6% 21.1% 21.5% 23.0%
Average 22.4%

Adjusted EBIT 5,375 5,488 5,404 5,669

% Margin 19.4% 17.2% 18.6% 20.7%
 7/25/2018

Projections
Jun-21 Jun-22

29,350 29,566
0.7% 0.7%

6,585 6,633
22.4% 22.4%

Projections
Jun-21 Jun-22

477 480
1.6% 1.6%

YTD
 Jun-17 Mar-18

377 343
1.3%

Projections
Jun-21 Jun-22

2,432 2,450
8.3% 8.3%

(18) (18)

Latest
Jun-17 Mar-18

16,286 18,661
(6,163) (7,372)
0 0
(7,238) (9,099)
457 1,538
3,342 3,728
11.7%

542 (386)

Projections
Jun-21 Jun-22

836 843
2.8% 2.8%

YTD
Jun-17 Mar-18

618 486
 2.2%

Jun-17

4,689
(1,419)
30.3%

Source: https://www.stock-
analysis-on.net

Jun-21 Jun-22

6,585 6,633

(836) (843)

5,748 5,791
(1,322) (1,332)
4,426 4,459

(477) (480)
(18) (18)
836 843

4,768 4,803
1% 1%
 YTD
Jun-17 Mar-18

28,500 22,459
4.3%

(17,775) (14,722)
10,725 7,737

0 0
(3,617) (2,671)
(18,643) (15,209)
(22,260) (17,880)

6,240 4,579

618 486
0 0
0 0
0 0
0 0
0 0
0 0
6,858 5,065
24.1% 22.6%

6,240 4,579
21.9% 20.4%