PURPOSE OF MODEL
Highly versatile and user-friendly Excel model for the preparation of a rolling 3 statement (Income Statement, Balance Sheet and Cash flow Statement) financial projection for a startup or existing Hotel business generating revenue from room occupancy, events, bar sales, restaurant sales and other income categories.
The model follows best practice financial modelling principles and includes instructions, line item explanations, checks and input validations.
The key outputs include:
– Projected full financial statements (Income Statement, Balance Sheet and Cash flow Statement) presented on a quarterly basis across up to 5 years and summarised on an annual basis.
– Dashboard with:
o Summarised projected Income Statement and Balance Sheet;
o Compounded Annual Growth rate (CAGR) for each summarised income statement and Balance Sheet line item;
o List of key ratios including average revenue growth, average profit margins, average return on assets and equity and average debt to equity ratio;
o Bar charts summarising income statement and Balance Sheet projections;
o Chart presenting revenue mix and total nights by month and room type;
o Gross profit by income source.
Inputs are split into Income Statement and Balance Sheet Inputs. Most inputs include user-friendly line item explanations and input validations to help users understand what the input is for and populate correctly.
– Name of business;
– First projection year and quarter;
– Naming for room types, other income, variable costs, staff cost, fixed costs, fixed assets and borrowings;
– Sales tax applicability for revenue and cost categories;
– Opening balance sheet (for existing businesses);
– Income Statement actuals (for trend analysis);
– Room revenue inputs including
o Number of rooms by room type;
o Occupancy rate (by month or year)
o Rate per night by room type;
o Seasonality discounts;
o Settlement assumptions;
– Other income inputs including
o Revenue per unit
– Cost of goods sold inputs including:
o percentage of revenue;
o Safety stock percentage;
o Average credit terms;
– Other cost inputs including
o Other variable costs
o Marketing costs
o Staff costs
o Other costs
– Sales and corporate tax inputs including rate and payment periods;
– Dividend inputs including amount or percentage of retained earnings and frequency;
– Fixed Assets including addition amounts and useful life;
– Borrowings including addition/redemption amounts and interest rate;
– Share Capital additions.
The model comprises of 9 tabs split into input (‘i_’), calculation (‘c_’), output (‘o_’) and system tabs. The tabs to be populated by the user are the input tabs (‘i_Setup’, ‘i_Actuals’ and ‘i_Assumptions’). The calculation tab uses the user-defined inputs to calculate and produce the projection outputs which are presented in ‘o_Fin Stats’, ‘o_Charts’ and ‘o_DCF’.
System tabs include:
– A ‘Front Sheet’ containing a disclaimer, instructions and contents;
– A Checks dashboard containing a summary of checks by tab.
Other key features of this model include the following:
– The model follows best practice financial modelling guidelines and includes instructions, line item explanations, checks and input validations;
– The model is not password protected and can be modified as required following download;
– The model contains a dynamic timeline that allows for a mix of Actual and Forecast period across a 5-year period allowing projections to be rolled forward from month to month;
– The model has been reviewed using specialised model audit software to ensure consistency of formulas and significantly reduce risk of errors;
– Timeline is split on a monthly basis and summarised on an annual basis;
– Apart from room occupancy revenue, the model allows the user to model 5 additional income categories and their related costs;
– Costs are split into: variable and fixed for better driver-based forecasting;
– The model allows for the following number of underlying categories for each line item (these can be easily expanded if required):
o Room types – 8 types;
o Other Income – 5 categories
o Cost of goods sold – 6 categories (Room revenue + 5 other income categories)
o Other variable costs – 5 categories
o Staff costs – 8 categories;
o Marketing costs – 3 categories;
o Other expenses – 10 categories;
o Fixed Assets – 5 categories;
o Borrowings – 3 facilities;
– Apart from projecting revenue and costs the model includes the possibility to model inventory, deferred income, payables, fixed assets, borrowings, dividends, corporate tax and sales tax;
– The model included an integrated discounted cash flow valuation using the projected cash flow outputs;
– Business Name, currency, starting projection period are fully customisable;
– Revenue, Cost, Fixed Asset and Borrowing category descriptions are fully customisable;
– The model includes instructions, line item explanations, checks and input validations to help ensure input fields are populated accurately;
– The model includes a checks dashboard which summarises all the checks included in the various tabs making it easier to identify any errors.
If you require any help with using the model or modifications, we are happy to help. Please contact us on [email protected] so that they can direct you for further instructions.
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