North West Egg Sales Business Plan — Funding Requirement and Structure
R52.9m: R24.0m equity, R26.25m senior term loan and R2.68m asset finance, and precisely where it goes.
Section 28 of 31
Funding Requirement and Structure
Jump to section
- 0. Executive Summary
- 1. Investment Thesis
- 2. Company Overview
- 3. Location
- 4. Problem and Value Proposition
- 5. Products and Pricing
- 6. Industry Analysis
- 7. Market Sizing
- 8. Customers and Channels
- 9. Competitive Landscape
- 10. Competitive Positioning
- 11. Business Model and Unit Economics
- 12. Go-to-Market Strategy
- 13. Operating Model
- 14. Farm Infrastructure and Capital Expenditure
- 15. Biosecurity and Animal Health
- 16. Management and Organisation
- 17. Strategic Plan
- 18. SWOT Analysis
- 19. Risk Analysis
- 20. ESG and Sustainability
- 21. Implementation Roadmap
- 22. Financial Plan: Key Assumptions
- 23. Financial Plan: Revenue Build
- 24. Financial Plan: Projected Income Statement
- 25. Financial Plan: Projected Cash Flow
- 26. Financial Plan: Projected Balance Sheet
- 27. Funding Requirement and Structure
- 28. Debt Serviceability and Break-Even
- 29. Returns, Scenarios and Sensitivity
- 30. Investment Case and Next Steps
The business needs R52.9m: 84% builds the farm, 12% buys the first flock and the rest is liquidity
Funding mix
| Category | Sources | ||||
|---|---|---|---|---|---|
| Equity | 24.0 | ||||
| Senior term loan | 26.25 | ||||
| Asset finance | 2.68 | Uses of funds | R m | % | |
| Land, houses, equipment, packhouse, services | 40.72 | 77% | |||
| Professional fees and pre-operating capex | 1.45 | 3% | |||
| Contingency | 2.48 | 5% | |||
| First flock: 60,000 point-of-lay pullets | 6.34 | 12% | |||
| Pre-opening costs and construction interest | 0.41 | 1% | |||
| Working capital and liquidity headroom | 1.53 | 3% | |||
| Total uses | 52.93 | 100% |
Why this mix
| Sources of funds | R m | % |
|---|---|---|
| Equity tranche 1: at financial close (60%) | 14.40 | 27% |
| Equity tranche 2: on House 1 commissioning (40%) | 9.60 | 18% |
| Senior term loan (agri-DFI or commercial bank), drawn | 26.25 | 50% |
| Asset finance: vehicles and forklift | 2.68 | 5% |
| Total sources | 52.93 | 100% |
Long-life houses suit a 10-year loan; a 12-month capital moratorium covers the staggered fill.
45% equity is what it takes to hold smoothed DSCR above 1.2x; at 35% equity, Year 4 cover falls to 1.06x and breaches the covenant.
Milestone-linked second tranche protects investors against build slippage.
A blended-finance grant or concessional DFI pricing is not assumed; either would lift equity returns.
An undrawn R0.75m of the facility and a proposed R3m seasonal overdraft provide further cover.
