GreenH2 Fertiliser Business Plan › Section 13 › Financial Plan

All figures in this section derive from a single integrated financial
model in which the income statement, balance sheet and cash-flow
statement fully reconcile, and the balance sheet balances to zero in
every projection year. The model spans ten years: three years of
development and construction (pre-revenue), commissioning in Year 4, and
a ramp to full nameplate output by Year 6. Returns are presented on both
a project (unlevered) and an equity (levered) basis.

13.1 Key assumptions

Table 13. Principal modelling
assumptions.

13.2 Capital cost and funding

Total funded cost is approximately R37 billion: around R32 billion of
hard EPC and owner’s cost, plus interest during construction, working
capital and reserves. Funding is structured as roughly 60% senior
project debt and 40% equity, of which this R5.0 billion seed round forms
the development tranche drawn first.

Figure 5

Figure 6

Table 14. Hard capital cost by plant area (R
billion).

Figure 7

13.3 Projected income statement (operating years)

Table 15. Summary income statement, Years 4–10
(R billion).

Figure 8

Figure 9

13.4 Projected balance sheet (selected years)

The balance sheet balances precisely in every year. During
construction, property, plant and equipment accumulates as capital is
deployed and interest is capitalised; from Year 4 the asset depreciates
while retained earnings build and senior debt amortises from Year 6.

Table 16. Summary balance sheet, selected years
(R billion).

13.5 Projected cash-flow statement

Table 17. Summary cash-flow statement, Years
3–10 (R billion).

Figure 10

13.5.1 Working-capital build

Working capital is modelled on 45 days of receivables, 50 days of
inventory and 40 days of payables. The investment in net working capital
builds as the plant ramps and stabilises at full output — a cash use
that the funding plan explicitly provides for.

Table 18. Net working-capital investment by year
(R billion).

13.5.2 Monthly cash flow — first production year (Year 4)

Lenders require visibility of intra-year liquidity during
commissioning. The table and chart below set out the monthly operating
cash profile of the first production year, as output ramps from initial
commissioning toward the 40% annual average. Operating cash turns
positive as throughput rises, and the funding plan carries sufficient
reserves to bridge the early commissioning months.

Table 19. Year-4 monthly operating cash flow (R
million).

Figure 11

13.6 Debt service and cover

Senior debt is drawn during construction, carries an interest-only
grace period through commissioning and ramp (Years 4–5), and amortises
on a level-principal basis from Year 6. The debt-service cover ratio
(DSCR) strengthens steadily as the plant reaches nameplate, comfortably
clearing the 1.30x covenant floor from first repayment.

Figure 12

Figure 13

13.7 Key ratios

Table 20. Selected financial ratios.

13.8 Break-even analysis

On the full-production cost base — including fixed production cost,
overhead, depreciation and interest — the Project breaks even at
approximately 66% of nameplate capacity. Because the plant reaches 70%
utilisation in Year 5 and 100% in Year 6, it operates above break-even
from its second full year of production, providing a meaningful margin
of safety.

Figure 14

Figure 15

13.9 Sensitivity analysis

The Project IRR is most sensitive to selling price, then to capital
cost and operating cost, and least to volume within the tested range.
The tornado below isolates the impact of a single-variable move from the
base case, holding all else constant.

Figure 16

13.10 Scenario analysis

Three integrated scenarios stress multiple variables together. The
downside combines a 10% price fall, 8% cost increase, a 10% slower ramp
and 10% capex overrun; the severe scenario layers a 20% price fall, 15%
cost increase, 20% slower ramp and 20% capex overrun. The base case
remains robustly value-accretive, the downside remains above the cost of
debt, and only the severe (low-probability) conjunction erodes value —
underscoring the importance of the equity cushion and contracted
offtake.

Table 21. Three-scenario analysis of project
returns.

Figure 17

13.11 Valuation

Comparable global fertiliser and industrial-chemical businesses
typically trade at 7x–10x EBITDA. Applying this range to mature Year-6
EBITDA of R7.36bn implies an enterprise value of approximately R51.5bn
(low), R62.6bn (base) and R73.6bn (high). A successful migration toward
export-scale ammonia and hydrogen production could support a materially
higher strategic valuation over the longer term.

Figure 18

13.12 Returns summary

Table 22. Headline return metrics (base
case).

Confidential — this business plan is provided to prospective investors and lenders for evaluation purposes only and may not be reproduced or distributed without the written consent of GreenH2 Fertiliser Holdings (Pty) Ltd.