Quick and Efficient Gas Business Plan — Sensitivity and Scenario Analysis
What moves Year 5 EBITDA: fills a day, gas margin per kilogram, operating cost and the regulated price, with scenarios.
Sensitivity and Scenario Analysis
Jump to section
- Overview & contents
- i. Important Notice and Basis of Preparation
- 1. Executive Summary
- 2. The Business and the Regulated Price
- 3. Licensing, Safety and Compliance
- 4. Market and Customers
- 5. SWOT and Competitive Position
- 6. Operations
- 7. Financial Plan
- 8. Break-Even and Debt Service
- 9. Investment Analysis
- 10. Sensitivity and Scenario Analysis
- 11. The Margin Squeeze
- 12. Risk Analysis
- 13. Implementation Roadmap
- 14. Key Performance Indicators
- 15. Key Assumptions
- 16. Conclusion and Recommendation
- A. Appendix A: Consolidated Financial Summary
- B. Appendix B: Volume, Price and Cost Schedules
- C. Appendix C: Funding, Debt and Working Capital Schedules
- D. Appendix D: Risk Register
- E. Appendix E: Glossary
- 10.1 What moves Year 5 EBITDA
- 10.2 Scenarios
10.1 What moves Year 5 EBITDA
|
Driver |
Downside (R) |
Upside (R) |
Swing (R) |
|---|---|---|---|
|
Bulk gas buying price ±8% |
756 129 |
2 317 399 |
1 561 270 |
|
Volume ±15% |
940 730 |
2 132 799 |
1 192 069 |
|
Regulated price ±4% |
1 018 077 |
2 055 452 |
1 037 375 |
|
Accessory margin ±25% |
1 218 299 |
1 855 229 |
636 930 |
|
Operating costs ±10% |
1 242 188 |
1 831 340 |
589 152 |
|
Fill loss ±1.5 points |
1 385 400 |
1 683 574 |
298 174 |
|
Base case Year 5 EBITDA |
1 536 764 |
The ranking is the finding, and it is unusual. In most retail businesses volume dominates. Here the buying price ranks first at a R1 561 270 swing, ahead of both volume at R1 192 069 and the regulated price itself at R1 037 375, because an 8 per cent move in what the shop pays translates directly into margin with no ability to pass it on.
10.2 Scenarios
|
Downside |
Base |
Upside |
|
|---|---|---|---|
|
Volume assumption |
-22% |
As modelled |
+14% |
|
Buying price assumption |
+6% |
As modelled |
-3% |
|
Operating cost assumption |
+4% |
As modelled |
As modelled |
|
Year 1 EBITDA |
(930 854) |
(199 655) |
224 246 |
|
Year 3 EBITDA |
(169 886) |
1 031 151 |
1 762 886 |
|
Year 5 EBITDA |
87 831 |
1 536 764 |
2 426 934 |
|
Year 5 EBITDA margin |
0.5% |
9.2% |
14.5% |
|
Cumulative EBITDA, Years 1 to 5 |
(1 519 255) |
4 188 214 |
7 646 517 |
The downside combination — volume 22 per cent below plan, the buying price 6 per cent higher and operating costs 4 per cent higher — produces cumulative EBITDA of negative R1 519 255 across five years. The business does not merely underperform in that case; it consumes its equity and requires restructuring.