Spice Route Kitchens Business Plan — Financial Plan & Projections

15.1 Basis of preparation

Sponsor headline revenue and EBITDA are preserved exactly as briefed. Everything beneath EBITDA is independently re-derived: depreciation on a component basis from the capital-expenditure register, South African corporate tax at 27% with assessed-loss carry-forward, and working capital. The base case is funded entirely with the sponsor’s R18 million of equity (no debt), so there is no interest charge; a debt-capacity analysis for lenders is provided in Section 16. The three statements are integrated so the balance sheet ties to zero in every year, enforced by an automated assertion. All figures are nominal rand millions unless stated.

15.2 Key assumptions

Assumption	Value	Basis
Corporate tax rate	27%	SA rate; turnover >R20m so no SBC relief
Working capital	5% of revenue	Cash-heavy dine-in offset by catering/retail receivables & inventory
Funding	R18m equity	As briefed; all-equity base case
Depreciation	Component approach	Fit-out 6-yr; kitchen/catering equip 8-yr; furniture 6-yr; vehicles 5-yr; tech 4-yr
Cumulative capex	~R55m over 5 years	Flagship + multi-city restaurants + express + central kitchen
Repo / prime	7.0% / 10.5%	SARB, mid-2026
Exit valuation	6×–10× EV/EBITDA	Hospitality / branded-food comparables

Analyst flagRe-derived net profit versus the sponsor’s illustrative figures

Preserving revenue and EBITDA exactly, the fully-loaded model produces net profit of approximately R1.0m, R3.0m, R6.1m, R10.4m and R16.9m across Years 1–5, below the sponsor’s illustrative R1.4m to R20.7m, and increasingly so in later years. The gap is depreciation: a genuine multi-city rollout requires roughly R55m of cumulative capex, and depreciating it in full (rather than the lighter capex the illustrative figures imply) is the honest cost of building the network. It is disclosed rather than smoothed.

Figure 13. *Net profit after tax: re-derived vs sponsor illustrative.*

15.3 Projected profit & loss

R millions	Year 1	Year 2	Year 3	Year 4	Year 5
Revenue	22	39	62	91	128
EBITDA	3.5	7.8	13.9	21.4	31.8
Depreciation & amortisation	(2.1)	(3.6)	(5.5)	(7.2)	(8.7)
EBIT	1.4	4.2	8.4	14.2	23.1
Net interest (all-equity)	0.0	0.0	0.0	0.0	0.0
Profit before tax	1.4	4.2	8.4	14.2	23.1
Taxation (27%)	(0.4)	(1.1)	(2.3)	(3.8)	(6.2)
Net profit after tax	1.0	3.0	6.1	10.4	16.9
Net margin	4.5%	7.8%	9.8%	11.4%	13.2%

Figure 14. *EBITDA and margin trajectory.*

Figure 15. *Year-5 bridge: EBITDA to net profit.*

15.4 Projected cash flow statement

R millions	Year 1	Year 2	Year 3	Year 4	Year 5
EBITDA	3.5	7.8	13.9	21.4	31.8
Taxation paid	(0.4)	(1.1)	(2.3)	(3.8)	(6.2)
Working-capital movement	(1.1)	(0.8)	(1.1)	(1.4)	(1.9)
Operating cash flow	2.0	5.8	10.5	16.1	23.7
Capital expenditure	(13.3)	(9.2)	(11.8)	(10.0)	(10.3)
Equity drawn	18.0	0.0	0.0	0.0	0.0
Net movement in cash	6.7	(3.4)	(1.3)	6.1	13.4
Closing cash	6.7	3.4	2.0	8.2	21.6

Analyst flagLiquidity is thin in the peak-investment years

Operating cash flow is positive from Year 1, but the multi-city rollout consumes most of it: closing cash dips to roughly R2 million in Year 3 before rebuilding strongly. The R18 million funds Phase 1 and a measured rollout, but a faster pace, a fit-out overrun or a soft opening would exhaust the buffer, which is why committed follow-on capital or a working-capital facility is recommended (Section 16).

Figure 16. *Operating cash flow, capex and closing cash.*

Figure 17. *Closing cash runway across the investment phase.*

15.5 Projected balance sheet

R millions	Year 1	Year 2	Year 3	Year 4	Year 5
Net property, plant & equipment	11.2	16.7	23.0	25.8	27.5
Net working capital	1.1	1.9	3.1	4.5	6.4
Cash & equivalents	6.7	3.4	2.0	8.2	21.6
Total assets	19.0	22.0	28.1	38.5	55.4
Share capital	18.0	18.0	18.0	18.0	18.0
Retained earnings	1.0	4.0	10.1	20.5	37.4
Total equity / funding	19.0	22.0	28.1	38.5	55.4

StrengthThe balance sheet ties to zero every year

Total assets equal total equity in every projection year (all-equity structure), enforced by an automated assertion (maximum difference: 0.0). The business carries no debt and holds a net-cash position throughout, so it is financially resilient even as it invests, the constraint is the quantum of cash available for expansion, not solvency.

Figure 18. *Balance-sheet build: asset composition.*

15.6 Key financial ratios

The ratio summary distils the plan’s trajectory: margins expand as the diversified, higher-margin streams mature, the business remains net-cash and debt-free throughout, and returns on capital build as the asset base is sweated across a growing network.

Ratio	Year 1	Year 2	Year 3	Year 4	Year 5
EBITDA margin	15.9%	20.0%	22.4%	23.5%	24.8%
Net margin	4.5%	7.8%	9.8%	11.4%	13.2%
Net cash / (net debt) (R m)	6.7	3.4	2.0	8.2	21.6
Return on equity	5.2%	13.8%	21.7%	27.0%	30.5%
Capex / revenue	60.5%	23.6%	19.0%	11.0%	8.0%