SA Premier Poultry Business Plan — Sensitivity and Scenario Analysis
What moves Year 5 EBITDA: live bird cost, selling price, yield and throughput, with downside, base and upside scenarios.
Sensitivity and Scenario Analysis
Jump to section
- Overview & contents
- i. Important Notice and Basis of Preparation
- 1. Executive Summary
- 2. Scale and Business Model
- 3. Registration, Food 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. Risk Analysis
- 12. Implementation Roadmap
- 13. Key Performance Indicators
- 14. Key Assumptions
- 15. Conclusion and Recommendation
- A. Appendix A: Consolidated Financial Summary
- B. Appendix B: Throughput, Yield 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 EBITDA
- 10.2 Scenarios
- 10.3 The downside: a spread that will not open
10.1 What moves EBITDA
|
Driver |
Downside (R) |
Upside (R) |
Swing (R) |
|---|---|---|---|
|
Selling prices ±8% |
2 506 344 |
20 439 168 |
17 932 824 |
|
Live bird price ±8% |
5 370 504 |
17 543 184 |
12 172 680 |
|
Throughput ±15% |
6 778 104 |
16 151 496 |
9 373 392 |
|
Own-account share ±10 points |
8 160 000 |
14 769 600 |
6 609 600 |
|
Dressed yield ±2 points |
8 409 696 |
14 535 816 |
6 126 120 |
|
By-product recovery ±25% |
9 396 240 |
13 533 360 |
4 137 120 |
|
Processing costs ±12% |
10 000 896 |
12 928 704 |
2 927 808 |
|
Base case EBITDA at single-shift capacity |
11 464 800 |
Selling prices and live bird prices occupy the top two positions and together swing EBITDA by R30 105 504 — more than the remaining five drivers combined. That is the signature of a spread business, and it is why Section 9.3 separates the levers management controls from those it does not. Note also that throughput ranks third, not first: volume matters, but only once the spread is intact.
10.2 Scenarios
|
Downside |
Base |
Upside |
|
|---|---|---|---|
|
Throughput assumption |
-18% |
As modelled |
+10% |
|
Live bird price assumption |
+7% |
As modelled |
-4% |
|
Selling price assumption |
-6% |
As modelled |
+5% |
|
Year 1 EBITDA |
(11 631 090) |
(4 174 807) |
1 869 336 |
|
Year 3 EBITDA |
(4 745 858) |
12 387 558 |
26 401 533 |
|
Year 5 EBITDA |
3 793 075 |
38 869 531 |
67 551 515 |
|
Year 5 EBITDA margin |
1.3% |
13.7% |
23.9% |
|
Cumulative EBITDA, Years 1 to 5 |
(23 669 744) |
74 307 930 |
154 297 428 |
10.3 The downside: a spread that will not open
The distinction between the downside and the base case is not effort. It is three commodity variables moving modestly against the plant at the same time, which is an ordinary event in poultry rather than a catastrophic one. That is the honest characterisation of the risk in this investment, and it is why the funding structure carries 72 per cent equity and quasi-equity rather than a conventional gearing.