INCOME STATEMENT FORECAST USING A GROWTH RATE OF 3.

48% for
12/10/2016
2016 2017 2018 2019
Revenue 8979 9291.469 9614.812 9949.408
Margin 0.776 0.803005 0.830949 0.859866
Cost of Revenue 6967 7209.452 7460.341 7719.96
Operating income/ EBITDA 2325 2405.91 2489.636 2576.275
DEPRECIATION 0 0 0 0
DEPRECIATION RATE 0 0 0 0
EBIT 2325 2405.91 2489.636 2576.275
INTEREST RATE 0 0 0 0
INTEREST COST 0 0 0 0
EBT 2325 2405.91 2489.636 2576.275
TAX RATE 0.184 0.190403 0.197029 0.203886
TAX 427.8 442.6874 458.093 474.0346
NI (Continuous operation) 1897 1963.016 2031.329 2102.019

relative valuation EARNINGS REVENUE ((

2016 2017
EA/PE = EARNINGS/ NO.OF SHARE 1897 1963
30.2 25.2
LEWIS= 106/25 25.5 28.5

MACY CORPS =542/23 25.8 25.3

McDONALDS = 458/58 28.8 30.2

GROWTH RATE OF 3.48% for the next five years
6
2020 2021
10295.65 10653.94
0.88979 0.920754
7988.615 8266.619
2665.929 2758.704
0 0
0 0
2665.929 2758.704
0 0
0 0
2665.929 2758.704
0.210981 0.218323
490.531 507.6015
2175.169 2250.865
 FORECAST BALANCE SHEET
2016 2017 2018 2019 2020
TOTAL ASSETS 23850 24679.98 25538.84 26427.6 27347.28
TOTAL CURRENT ASSETS 7750 8019.7 8298.786 8587.583 8886.431
LONG TERM ASSETS 16100 16660.28 17240.06 17840.01 18460.84
TOTAL CURRENT LIABILITIES 3540 3663.192 3790.671 3922.586 4059.092
LONG TERM LIABILITIES 13172 13630.39 14104.72 14595.57 15103.49
TOTAL STOCKHOLDER EQUITY 7146 7394.681 7652.016 7918.306 8193.863
NET TANGIBLE ASSETS 23842 24671.7 25530.28 26418.73 27338.1
GOOD WILL 8 8.2784 8.566488 8.864602 9.17309
TOTAL ASSETS + EQUITY 23850 24679.98 25538.84 26427.6 27347.28
 2021
28298.96
9195.679
19103.28
4200.349
15629.09
8479.009
28289.47
9.492314
28298.96
 BALANCE SHEET FORECAST FOR THE NEXT FIVE YEARS
BASE DATA PROJECTED DATA
2016 2017 2018 2019 2020
Turnover (S/A) 0.43 0.444964 0.460449 0.476472 0.493054
Assest 23805 24633.41 25490.66 26377.73 27295.68
Leverage (D/A) 0.32 0.331136 0.34266 0.354584 0.366924
Debt 7632 7897.594 8172.43 8456.83 8751.128
Equity 16218 16782.39 17366.41 17970.76 18596.15

A= f(S,TO) D E D+E
Pre 23850 7632 16218 23850
Post 32436 10379.52 22056 32436
change 8586 2747.52 5838 8586

Gap = 0
D+E = A

GENERAL COMMENTS
Overall this method has a Gap of 0 (change between D+E and change in A
Has a constant L
By having these and imposing L that later imposed E producing a value that has the sum of the New Issue of Div. an

The constant figure in the diagram is 0.32 used

 2021
0.510212
28245.57
0.379693
9055.667
19243.29

of the New Issue of Div. and stock

 Base Data
In thousands
Income statement 31/10/2016 31/10/2017
Sales growth 6.80% 6.70%
Sales 8752 9338.38
Margin 0.734346435 0.74236334680604
Cost 6427 6932.474

Operating income/ EBITDA 2325 2405.91

DEPRECIATION RATE 9.42% 9.42%
DEPRECIATION 219.015 226.636722
EBIT 2105.985 2179.273278
INTEREST RATE 2.90% 2.90%
INTEREST COST 61.073565 63.198925062
EBT 2044.911435 2116.074352938
TAX RATE 28% 28%
TAX 572.5752018 592.50081882264
NI (Continuous operation) 1472.336233 1523.57353411536

Balance sheet

2016 2017
Turnover (S/A) 0.43 0.444964
Assest 23805 24633.414
Leverage (D/A) 0.32 0.32
Debt 7632 7897.5936
Equity 16218 16782.3864

Balance with assets 1 1

Cashflow 1118.776031 1157.70943729272
CAPM 0.085
DCF 1031.129983 1157.70943729272
Sum of DCF 7236.826029 6205.69604657225

H=5
GI=11.49%
Gs= 21.42%
Gordon Model (CF)= 7236.82

Two stage Model = 7236.72 6205 5047

sum of two stage 25471

RI = 612 542 512

ROE 0.1245
ROA 46.19%
P/E 45.93
PEG 1.6
PBR 100% No dividends were paid out

Number of shares = 58745879

Share price = 65.23
 Projected
Terminal value
31/10/2018 31/10/2019 31/10/2020 31/10/2021
-1.70% 3.40% 5.20% 4.60%
9179.63 9491.74 9985.31 10444.63
0.7287869698 0.7285771338 0.733014846 0.735873578073
6689.995804 6915.4639528 7319.3800082 7685.929897357

2489.635668 2576.2749892 2665.9293589 2758.703700561

9.42% 9.42% 9.42% 9.42%
234.52367993 242.68510399 251.13054561 259.8698885928
2255.1119881 2333.5898853 2414.7988133 2498.833811968
2.90% 2.90% 2.90% 2.90%
65.398247654 67.674106673 70.029165585 72.46618054707
2189.7137404 2265.9157786 2344.7696477 2426.367631421
28% 28% 28% 28%
613.11984732 634.456418 656.53550135 679.3829367979
1576.5938931 1631.4593606 1688.2341463 1746.984694623

2018 2019 2020 2021

0.4604487472 0.4764723636 0.4930536019 0.510211867201
25490.656807 26377.731664 27295.676726 28245.56627607
0.32 0.32 0.32 0.32
8172.4298573 8456.8304163 8751.1281148 9055.667373196
17366.413447 17970.764635 18596.147244 19243.29316804

1 1 1 1
1197.9977257 1239.6880466 1282.8291906 1327.471646418

1197.9977257 1239.6880466 1282.8291906 1327.471646418

5047.9866093 3849.9888836 2610.300837 1327.471646418

3849 2601 1347

584 598 547

Total asset turnover (S/A) = 8752/23845 = 0.43
Cost Margin (C/S) =6458/23845 = 0.2635
Leverage (D/A)= 7632/23805 =0.3578
Income Tax Rate (ITE/EBIT)= 1472/2145= 0.666
Interest rate (Int Expe/EBIT)= 61.2541/2145 = 0.0284
Plowback (Given) = 100%
ROE = P* Q* R = 0.25
ROA= G*R = 0.21
PEG = Given = 1.8
P/E = MPS/EPS = 23.6