Khanya Eggs Business Plan — Key Assumptions
Every production, price, cost, capital and funding assumption behind the model, stated so a funder can test each one independently.
Key Assumptions
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- Overview & contents
- i. Important Notice
- 1. Executive Summary
- 2. The South African Egg Market
- 3. Avian Influenza: The Risk That Defines This Business
- 4. SWOT and Competitive Position
- 5. The Five-Stage Roadmap
- 6. The Funding Ladder
- 7. Flock Performance
- 8. Feed Strategy
- 9. Point-of-Lay Pullet Sourcing
- 10. Biosecurity
- 11. Route to Market and Pricing
- 12. Operations and People
- 13. Regulation and Compliance
- 14. Unit Economics
- 15. Capital Expenditure
- 16. Financial Projections
- 17. Break-Even
- 18. Sensitivity and the Grant Question
- 19. Risk Management
- 20. Implementation Roadmap
- 21. Returns
- 22. Key Performance Indicators
- 23. Key Assumptions
- 24. Conclusion
- A. Appendix A: Consolidated Financial Summary
- B. Appendix B: Stage Capital Schedules
- C. Appendix C: Debt Schedules
- D. Appendix D: Risk Register
- E. Appendix E: Funding Application Checklist
- F. Appendix F: Glossary
- 23.1 Production
- 23.2 Price and cost
- 23.3 Capital, funding and tax
23.1 Production
|
Assumption |
Year 1 |
Year 5 |
Basis |
|---|---|---|---|
|
Birds at year end |
500 |
30 000 |
Five stages, each gated on the preceding one |
|
Average hens in lay |
330 |
21 000 |
Reflects placement timing and mortality within the year |
|
Hen-day production |
72.2% |
80.7% |
Below the 85%-plus of leading commercial units; gates set slightly ahead |
|
Eggs per hen per year |
264 |
295 |
Derived from hen-day production |
|
Mortality |
10% |
6% |
Improving with husbandry, biosecurity and automation |
|
Eggs sold |
87 000 |
6 184 000 |
About 206 127 trays at Year 5 |
|
Pullet cost per bird |
R136 |
R162 |
R135 base escalating; eighteen weeks to point of lay |
|
Laying cycle |
72 weeks |
72 weeks |
From point of lay to spent-hen sale |
23.2 Price and cost
|
Assumption |
Value |
Basis |
|---|---|---|
|
Blended price per egg |
R2.77 rising to R2.81 |
6% annual escalation offset by the mix shift into wholesale |
|
Direct channel share |
62% falling to 26% |
Farm gate demand cannot absorb 6.18 million eggs |
|
Local trade share |
38% falling to 31% |
The durable core of the margin |
|
Wholesale and agents |
Nil rising to 29% |
The release valve for volume the direct channel cannot take |
|
Retail agreement |
Nil rising to 14% |
From Stage 4; requires grading to specification |
|
Feed cost |
56.2% of direct cost |
Layer feed averaged R5 625 per ton in 2024, down 6.4% |
|
Vaccination and health |
4.7% of direct cost at Year 5 |
Includes HPAI vaccination at roughly R1.50 per shot |
|
Owner remuneration |
R96 000 rising to R312 000 |
A real cost from Stage 1, inside every break-even figure |
|
Fixed cost base |
R288 000 rising to R2 762 000 |
Grows with staff, vehicles, grading room and mill |
23.3 Capital, funding and tax
|
Assumption |
Value |
Basis |
|---|---|---|
|
Total capital deployed |
R13 533 000 |
Five stages: R650k, R853k, R1 760k, R4 100k, R6 170k |
|
Fixed assets |
R12 262 000 |
Houses, cages, equipment, vehicles, solar, grading, mill |
|
Working capital |
R1 271 000 |
Opening flock and feed stock at each stage |
|
Founder cash |
R450 000 |
Contributed at Stage 1 |
|
Grant funding, targeted |
R3 650 000 |
NYDA, AgriSETA, Blended Finance Scheme; competitive and not committed |
|
Staged loans |
R9 250 000 |
Drawn stage by stage; rates 6.5% to 11% |
|
Retained cash |
R183 000 |
Generated in Stages 3 to 5 |
|
Loan terms |
One-year capital moratorium, seven-year amortisation |
Applied to each tranche from its draw date |
|
Depreciation |
Houses 20 years, cages and plant 10, vehicles 5, solar 15 |
Straight line |
|
Corporate income tax |
27% of taxable profit |
Assessed losses carried forward subject to the section 20 limitation |
|
Terminal value |
5.0x Year 5 EBITDA in the central case |
Tested from 3.0x to 7.0x in Section 21 |