Meridian Industrial Group Business Plan — Projected Cash Flow

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Section 16 · 17 of 20

Projected Cash Flow

The cash-flow statement reconciles net profit to the movement in cash, capturing capital expenditure, working-capital investment, debt drawdowns and repayments, equity injection and dividends. Figures in ZAR millions.

Year 1

Year 2

Year 3

Year 4

Year 5

Net profit after tax

94

183

437

886

1,538

Add back: depreciation

128

226

283

302

328

Less: working-capital investment

-312

-221

-286

-338

-455

Operating cash flow

-89

188

435

850

1,410

Less: capital expenditure

-1,522

-1,257

-681

-222

-310

Investing cash flow

-1,522

-1,257

-681

-222

-310

Debt drawdowns

1,400

600

280

0

0

Debt repayments

-0

-0

-150

-350

-500

Equity injection

1,520

0

0

0

0

Dividends paid

-28

-55

-131

-266

-461

Financing cash flow

2,892

545

-1

-616

-961

Net change in cash

1,280

-524

-248

12

139

Closing cash balance

1,280

757

509

521

660

Figure 18. Cumulative five-year cash-flow waterfall (ZAR millions)
Figure 19. Pre-dividend free cash flow to equity (ZAR millions)

Year-1 phasing and liquidity

Because Year 1 combines the full equity injection, the first debt tranche, front-loaded capital deployment and the initial working-capital build, liquidity management in the opening year is the tightest of the projection. The indicative quarterly phasing below shows revenue and cash building through the year as anchor acquisitions consolidate and upgraded capacity comes online; the retained cash buffer and the working-capital facility carry the Group through the ramp.

Year-1 quarter

Q1

Q2

Q3

Q4

FY1

Revenue (R m)

360

528

672

840

2,400

Revenue build

15%

22%

28%

35%

100%

Capacity status

Integrating

Ramping

Scaling

At run-rate

NoteLiquidity is engineered, not assumed

The funding structure deliberately over-provides cash in Year 1, equity is drawn in full at close while capital deploys over three years, so that the Group carries a buffer through its highest-execution, lowest-maturity period. This is why the Year-1 closing cash balance is elevated and then normalises as capital is put to work.