absorbent

7/28/2019 Absorbent

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Table of Contents

1.Executive Summary...................................................................................1

2.Product Description and Application.......................................................1

3.Market Study, Plant Capacity and Production Program.......................2

3.1Market Study...............................................................................................................23.1.1Present Demand and Supply................................................................................2

3.1.2Projected Demand................................................................................................3

3.1.3Pricing and Distribution.......................................................................................43.2Plant Capacity.............................................................................................................5

3.3Production Program....................................................................................................6

4.Raw Materials and Utilities.......................................................................6

4.1Availability and Source of Raw Materials..................................................................6

4.2Annual Requirement and Cost of Raw Materials and Utilities...................................6

5Location and Site.........................................................................................7

6Technology and Engineering .....................................................................7

6.1Production Process......................................................................................................7

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1. Executive Summary

This project profile deals with the establishment of absorbent cotton making plant in

Amhara National Regional State. The following presents the main findings of the study.

Demand projection divulges that the domestic demand for absorbent cotton is substantial

and is increasing with time. Accordingly, the planned plant is set to produce 160 ton

annually. The total investment cost of the project including working capital is estimated

at Birr 12.89 million and creates 40 jobs and Birr 554.4 thousands of income.

The financial result indicates that the project will generate profit beginning from the first

year of operation. Moreover, the project will break even at 24.6% of capacity utilization

and it will payback fully the initial investment less working capital in 3 years. The result

further shows that the calculated IRR of the project is 28% with NPV of Birr

5,276,413.57

In addition to this, the proposed project possesses wide range of economic and social

benefits such as increasing the level of investment, tax revenue, employment creation and

import substitution.

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3. Market Study, Plant Capacity and Production

Program

3.1 Market Study

3.1.1 Present Demand and Supply

At present the demand for absorbent cotton is met from domestic production as well as

import. However, there is no exact figure as to the level of domestic production per

annum. Similarly, the information obtained from Customs Authority aggregates the

sanitary pad with other similar materials so that the actual level of import could not be

documented. However, a market research conducted in various supermarkets and shops

in Addis Ababa revealed that most of the sanitary pads on sale are imported ones. This

suggests that domestic production is unable to meet the growing demand for the product.

To arrive at the present effective demand for the product, this profile employed a proxy

approach as follows. As has been stated earlier, women use sanitary pads during their

menstruation period. Therefore, the demand for the product depends on the number of women in the age group 15-49 years that are believed to make use of the product.

According to CSA, Annual abstract (2006), currently there are 3.5 million women in

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The age group listed in the above table represents the age group that demands sanitary

pads. However, for a number of reasons such as ability to pay, awareness, etc, women in

the urban areas use the product more frequently than the rural areas. Therefore, in

estimating the present demand, it is important to make some assumption as to the demand

for the product. In this connection it is assumed that about 30% of the urban women and

1% of the rural women make use of absorbent cotton during their menstruation period.

Given the importance of the product, this assumption can be considered as a conservative

approach. Thus, about 1,061,984 women in the urban area and about 148,938 of the

urban females make use of the sanitary towel every month. This makes the total potential

users to be 1,210,922. On average a woman uses 4 pads in a given month, and, therefore,

the annual demand for the absorbent cotton is estimated to be about 58,124,235 pieces

per year. Roughly speaking this is equivalent to 581.2 tons. Therefore, this figure can be

fairly taken as the current level of demand for the product.

3.1.2 Projected Demand

In forecasting the future demand for absorbent cotton the population growth rate is used.

This is because as the number of women with in the age group of 15 to 49 increases, the

demand for the product also increases. Accordingly, 3% growth rate is considered to

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Table 2: Projected Demand for Absorbent Cotton (in tons)

Year Projected Demand

2007/08 599

2008/09 617

2009/10 635

2010/11 654

2011/12 674

2012/13 694

2013/14 715

2014/15 736

2015/16 758

2016/17 781

2017/18 805

2018/19 829

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packet. In distributing the product the envisaged plant shall make use of the available

retail and wholesale network.

3.2 Plant Capacity

Thus, given the expected demand for absorbent cotton as presented earlier, and the

planned technology, the envisaged plant is set to produce 160 tons annually. For a plant

that may start operation in 2009/10 this capacity represents about 19% of the total

demand.

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3.3 Production Program

The program is scheduled based on the consideration that the envisaged plant will work

275 days in a year in 1 shift, where the remaining days will be holidays and for

maintenance. During the first year of operation the plant will operate at 55 percent

capacity and then it grows to 75 percent in the 2nd year and 90 percent in the 3 rd year. The

capacity will grow to 100 percent starting from the 4 th year. This consideration is

developed based on the assumption that market and logistics barriers would take place for

the first three years of operation.

4. Raw Materials and Utilities

4.1 Availability and Source of Raw Materials

The main raw materials required in the production of absorbent cotton are raw ginned

cotton, soda ash, caustic soda, bleaching agent, other chemicals, wetting agents and

packing materials. The raw cotton shall be secured from the region while the other

materials are imported from abroad.

4.2 Annual Requirement and Cost of Raw Materials and Utilities

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Table 3: Material and Utility Requirement

Material and Input QuantityTotal Cost

L.C. F.C.

Raw Cotton 170 ton 1,200,000

Soda Ash 13 ton 65,000

Caustic Soda 18 ton 108,000

Bleaching Agent 13 84,500

Other Chemicals Lump sum 16,175

Wetting agent Lump sum 24,263

Packing Material Lump sum 40,438

Total Material Cost 1,060,438 297,938

Utility

Electricity 120,000 kwh 66,000

Furnace Oil 60,000 lit 420,000

Water 10,000m3 26,500

Total Utility Cost 512,500

According to the above table the annual cost of material and utility at full capacity of

operation is Birr 1,870,876.

5 Location and Site

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cotton is then bleached with chemicals like hydrogen peroxide or sodium hypochlorite.

The bleaching not only whitens the cotton but also improves its moisture absorbing

qualities and further cleans it. The bleached cotton is thoroughly washed again to remove

adhering chemicals. A small quantity of dilute sulpheric acid may be used to neutralize

any excess alkali. The neutralized cotton is then processed in a hydro extractor to remove

absorbed water and dilute sulpheric acid. It is then opened again in a wet cotton opening

machine.

The opened cotton is then dried or subjected to sun drying. Sun drying in the open,

however, is not advisable as it attracts fresh dust and requires a huge amount of open

space. After drying the cotton is sent to the blow room where it is opened more

thoroughly and made into laps. The laps of cotton are then fed into a carding machine

which turns the cotton laps into 6” to 12” wide brands. A special indigo colored paper is

placed under each band and the cotton is rolled, compressed, weighed and cut into

packaging of different sizes. The rolls are then packed in a polyethylene roll after

labelling and stamping with correct weight. The final packing is done in a card board or

corrugated board cartons.

The alternative technology requires a fully automatic production process. In this situation

much of the work will be handled by the machines and minimizes the role of labor in the

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Machinery and Equipment Quantity

High Pressure Kier Boiler (cap 500 kg) 1Carding Machine 1

Wet Cotton Opener 1

Hydro extractor (centrifugal type) 1

Cotton drier (steam operated continuous type) 1

Dry Cotton Opener 1

Porcupine Cleaner 1

Lap Forming Machine 1

Rolling Machine 1

Rolling Cutting Band Saw 1

Multi-Fuel Boiler (1000kg/hr evaporation

capacity at 150 psig) 1

Water Reservoir (15,000 litters cap) 1

Water, Steam, Discharging piping and fittings 1Laboratory and testing equipment set

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1. Machinery Manufacturers Corporation

B-61, Circular Garden Road,

Calcutta – 600 043, India

2. Gujarat Machinery Manufacturers Ltd.,

187, Worli, Mumbai – 400018, India

6.3 Civil Engineering Cost

The total site area for the envisaged plant is estimated to be 500m 2 where 350m2 is

allocated for the production place and the remaining space is left for stores (100m 2),

office buildings and facilities (50m2).

7 Human Resource and Training Requirement

7.1 Human Resource

The list of required manpower for the envisaged plant is stated in table 5 below.

Table 5: Human Resource Requirement

Position No. RequiredMonthlySalary Total Annual Salary

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Building 5%

Machinery and equipment 10%

Office furniture 10%

Vehicles 20%

Pre-production (amortization) 20%

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C. Working Capital (Minimum Days of Coverage)

Raw Material-Local 30

Raw Material-Foreign 120

Factory Supplies in Stock 30

Spare Parts in Stock and Maintenance 30

Work in Progress 10

Finished Products 15

Accounts Receivable 30Cash in Hand 30

Accounts Payable 30

8.2 Investment

The total investment cost of the project including working capital is estimated at Birr

12.89 million as shown in table 6 below. The Owner shall contribute 40% of the finance

in the form of equity while the remaining 60% is to be financed by bank loan.

Table 6: Total initial investment

Items L.C F.C Total

Land 1,500 1,500

Building and civil works 1,000,000 1,000,000

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8.3 Production Costs

The total production cost at full capacity operation is estimated at Birr 4.59 million as

detailed in table 7 below.

Table 7: Production Cost

Items Cost1. Raw materials 1,358,376

2. Utilities 512,500

3. Wages and Salaries 554,400

4. Spares and Maintenance 116,015

Factory costs 2,541,291

5. Depreciation 1,276,015

6. Financial costs 773,887

Total Production Cost 4,591,193

8.4 Financial Evaluation

I. Profitability

According to the projected income statement attached in the annex part (see annex 4) the

project will generate profit beginning from the first year of operation. A modest profit,

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III. Payback Period

Investment cost and income statement projections are used in estimating the project

payback period. The project will payback fully the initial investment less working capital

in 3 years.

IV. Simple Rate of Return

For the envisaged plant the simple rate of return equals to 27.9%

V. Internal Rate of Return and Net Present Value

Based on cash flow statement described in the annex part, the calculated IRR of the

project is 28% and the net present value at 18 % discount is Birr 5,276,413.57

VI. Sensitivity Analysis

The envisaged plant incurs loss of Birr 116,424.11 in the first year of operation when cost

of production increases by about 10%. The plant will generate profit starting from the

second year. This result is accompanied by somewhat similar NPV obtained earlier.

9 Economic and Social Benefit and Justification

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B. Tax Revenue

In the project life under consideration, the region will collect about Birr 11.3 million from

corporate tax payment alone (i.e. excluding income tax, sales tax and VAT). Such result

creates additional fund for the regional government that will be used in expanding social

and other basic services in the region.

C. Import Substitution and Foreign Exchange Saving

Based on the projected figure we learn that in the project life an estimated amount of US

Dollar 8.09 million will be saved as a result of the proposed project. This will create

room for the saved hard currency to be allocated to other vital and strategic sectors.

D. Employment and Income Generation

The proposed project is expected to create employment opportunity for several citizens of

the region. That is, it will provide permanent employment to 40 professionals as well as

support staff. Consequently the project creates income of Birr 554.4 thousand per year.

This would be one of the commendable accomplishments of the project.

E. Pro Environment Project

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ANNEXES

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Annex 1: Total Net Working Capital Requirements (in Birr)

CONSTRUCTION PRODUCTION

Year 1 Year 2 1 2 3 4

Capacity Utilization (%) 0 0 55% 75% 90% 100%

1. Total Inventory 0.00 0.00 465214.65 634383.62 761260.34 845844.82

Raw Materials in Stock- Total 0.00 0.00 135131.40 184270.09 221124.11 245693.45

Raw Material-Local 0.00 0.00 63626.28 86763.11 104115.73 115684.15

Raw Material-Foreign 0.00 0.00 71505.12 97506.98 117008.38 130009.31

Factory Supplies in Stock 0.00 0.00 2290.38 3123.25 3747.90 4164.33

Spare Parts in Stock and Maintenance 0.00 0.00 20882.70 28476.41 34171.69 37968.55

Work in Progress 0.00 0.00 57259.59 78081.26 93697.51 104108.35

Finished Products 0.00 0.00 114519.18 156162.52 187395.02 208216.69

2. Accounts Receivable 0.00 0.00 528000.00 720000.00 864000.00 960000.00

3. Cash in Hand 0.00 0.00 64014.00 87291.82 104750.18 116389.09

CURRENT ASSETS 0.00 0.00 922097.25 1257405.35 1508886.41 1676540.46

4. Current Liabilities 0.00 0.00 528000.00 720000.00 864000.00 960000.00

Accounts Payable 0.00 0.00 528000.00 720000.00 864000.00 960000.00

TOTAL NET WORKING CAPITAL REQUIRMENTS 0.00 0.00 394097.25 537405.35 644886.41 716540.46

INCREASE IN NET WORKING CAPITAL 0.00 0.00 394097.25 143308.09 107481.07 71654.05

1

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Annex 1: Total Net Working Capital Requirements (in Birr) (continued)

PRODUCTION

5 6 7 8 9 10

Capacity Utilization (%) 100% 100% 100% 100% 100% 100%

1. Total Inventory 845844.82 845844.82 845844.82 845844.82 845844.82 845844.82

Raw Materials in Stock-Total 245693.45 245693.45 245693.45 245693.45 245693.45 245693.45

Raw Material-Local 115684.15 115684.15 115684.15 115684.15 115684.15 115684.15

Raw Material-Foreign 130009.31 130009.31 130009.31 130009.31 130009.31 130009.31

Factory Supplies in Stock 4164.33 4164.33 4164.33 4164.33 4164.33 4164.33

Spare Parts in Stock and Maintenance 37968.55 37968.55 37968.55 37968.55 37968.55 37968.55

Work in Progress 104108.35 104108.35 104108.35 104108.35 104108.35 104108.35

Finished Products 208216.69 208216.69 208216.69 208216.69 208216.69 208216.69

2. Accounts Receivable 960000.00 960000.00 960000.00 960000.00 960000.00 960000.00

3. Cash in Hand 116389.09 116389.09 116389.09 116389.09 116389.09 116389.09

CURRENT ASSETS 1676540.46 1676540.46 1676540.46 1676540.46 1676540.46 1676540.46

4. Current Liabilities 960000.00 960000.00 960000.00 960000.00 960000.00 960000.00


TOTAL NET WORKING CAPITAL REQUIRMENTS 716540.46 716540.46 716540.46 716540.46 716540.46 716540.46

INCREASE IN NET WORKING CAPITAL 0.00 0.00 0.00 0.00 0.00 0.00

2

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Annex 2: Cash Flow Statement (in Birr)

3

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Year 1 Year 2 1 2 3 4

TOTAL CASH INFLOW 6090787.50 6807327.96 5368000.00 6792000.00 8064000.00 8896000.00

1. Inflow Funds 6090787.50 6807327.96 528000.00 192000.00 144000.00 96000.00

Total Equity 2436315.00 2722931.18 0.00 0.00 0.00 0.00

Total Long Term Loan 3654472.50 4084396.78 0.00 0.00 0.00 0.00

Total Short Term Finances 0.00 0.00 528000.00 192000.00 144000.00 96000.00

2. Inflow Operation 0.00 0.00 4840000.00 6600000.00 7920000.00 8800000.00

Sales Revenue 0.00 0.00 4840000.00 6600000.00 7920000.00 8800000.00

Interest on Securities 0.00 0.00 0.00 0.00 0.00 0.00

3. Other Income 0.00 0.00 0.00 0.00 0.00 0.00

TOTAL CASH OUTFLOW 6090787.50 6090787.50 4479213.47 4518098.25 5709891.12 5954161.36

4. Increase In Fixed Assets 6090787.50 6090787.50 0.00 0.00 0.00 0.00

Fixed Investments 5800750.00 5800750.00 0.00 0.00 0.00 0.00

Pre-production Expenditures 290037.50 290037.50 0.00 0.00 0.00 0.00

5. Increase in Current Assets 0.00 0.00 922097.25 335308.09 251481.07 167654.05

6. Operating Costs 0.00 0.00 1471624.48 1964314.30 2333831.65 2580176.56

7. Corporate Tax Paid 0.00 0.00 0.00 0.00 1060879.93 1297409.67

8. Interest Paid 0.00 0.00 2085491.73 928664.31 773886.93 619109.54

9.Loan Repayments 0.00 0.00 0.00 1289811.55 1289811.55 1289811.55

10.Dividends Paid 0.00 0.00 0.00 0.00 0.00 0.00

Surplus(Deficit) 0.00 716540.46 888786.53 2273901.75 2354108.88 2941838.64

Cumulative Cash Balance 0.00 716540.46 1605327.00 3879228.75 6233337.63 9175176.26

Annex 2: Cash Flow Statement (in Birr): Continued

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PRODUCTION

5 6 7 8 9 10


1. Inflow Funds 0.00 0.00 0.00 0.00 0.00 0.00

Total Equity 0.00 0.00 0.00 0.00 0.00 0.00

Total Long Term Loan 0.00 0.00 0.00 0.00 0.00 0.00

Total Short Term Finances 0.00 0.00 0.00 0.00 0.00 0.00


Sales Revenue 8800000.00 8800000.00 8800000.00 8800000.00 8800000.00 8800000.00


3. Other Income 0.00 0.00 0.00 0.00 0.00 0.00


4. Increase In Fixed Assets 0.00 0.00 0.00 0.00 0.00 0.00


Pre-productionExpenditures 0.00 0.00 0.00 0.00 0.00 0.00

5. Increase in Current Assets 0.00 0.00 0.00 0.00 0.00 0.00

6. Operating Costs 2580176.56 2580176.56 2580176.56 2580176.56 2580176.56 2580176.56


8. Interest Paid 464332.16 309554.77 154777.39 0.00 0.00 0.00

9. Loan Repayments 1289811.55 1289811.55 1289811.55 0.00 0.00 0.00

10.Dividends Paid 0.00 0.00 0.00 0.00 0.00 0.00

Surplus(Deficit) 3121836.85 3165376.52 3273720.69 4671876.41 4671876.41 4671876.41

Cumulative Cash Balance 12297013.11 15462389.64 18736110.33 23407986.74 28079863.14 32751739.55

Annex 3: DISCOUNTED CASH FLOW-TOTAL CAPITAL INVESTED

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Year 1 Year 2 1 2 3 4



Sales Revenue 0.00 0.00 4840000.00 6600000.00 7920000.00 8800000.00


2. Other Income 0.00 0.00 0.00 0.00 0.00 0.00


3. Increase in Fixed Assets 6090787.50 6090787.50 0.00 0.00 0.00 0.00



4. Increase in Net Working Capital 0.00 0.00 394097.25 1 43308.09 1 07481.07 71654.05

5. Operating Costs 0.00 0.00 1471624.48 1964314.30 2333831.65 2580176.56


NET CASH FLOW -6090787.50 -6090787.50 2974278.26 4492377.61 4417807.35 4850759.72

CUMMULATIVE NET CASH FLOW -6090787.50 -12181575.00 -9207296.74 -4714919.12 -297111.77 4553647.95

Net Present Value (at 18%) -6090787.50 -5161684.32 2136080.34 2734199.71 2278655.88 2120311.78

Cumulative Net present Value -6090787.50 -11252471.82 -9116391.48 -6382191.78 -4103535.89 -1983224.11

Annex 3: DISCOUNTED CASH FLOW-TOTAL CAPITAL INVESTED (Continued)

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PRODUCTION

5 6 7 8 9 10



Sales Revenue 8800000.00 8800000.00 8800000.00 8800000.00 8800000.00 8800000.00


2. Other Income 0.00 0.00 0.00 0.00 0.00 0.00


3. Increase in Fixed Assets 0.00 0.00 0.00 0.00 0.00 0.00



4. Increase in Net Working Capital 0.00 0.00 0.00 0.00 0.00 0.00

5. Operating Costs 2580176.56 2580176.56 2580176.56 2580176.56 2580176.56 2580176.56


NET CASH FLOW 4875980.55 4764742.84 4718309.62 4671876.41 4671876.41 4671876.41

CUMMULATIVE NET CASH FLOW 9429628.51 14194371.35 18912680.97 23584557.38 28256433.79 32928310.19

Net Present Value (at 18%) 1806216.98 1495772.05 1255250.43 1053302.90 892629.58 756465.74

Cumulative Net present Value -177007.13 1318764.93 2574015.35 3627318.25 4519947.83 5276413.57

Net Present Value (at 18%) 5,276,413.57

Internal Rate of Return 28.0%

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Annex 4: NET INCOME STATEMENT ( in Birr)

PRODUCTION

1 2 3 4 5Capacity Utilization (%) 55% 75% 90% 100% 100%

1. Total Income 4840000.00 6600000.00 7920000.00 8800000.00 8800000.00

Sales Revenue 4840000.00 6600000.00 7920000.00 8800000.00 8800000.00

Other Income 0.00 0.00 0.00 0.00 0.00

2. Less Variable Cost 1232928.98 1681266.80 2017520.15 2241689.06 2241689.06

VARIABLE MARGIN 3607071.02 4918733.21 5902479.85 6558310.94 6558310.94

(In % of Total Income) 74.53 74.53 74.53 74.53 74.53

3. Less Fixed Costs 1514710.50 1559062.50 1592326.50 1614502.50 1614502.50

OPERATIONAL MARGIN 2092360.52 3359670.71 4310153.35 4943808.44 4943808.44


4. Less Cost of Finance 2085491.73 928664.31 773886.93 619109.54 464332.16

5. GROSS PROFIT 6868.79 2431006.39 3536266.42 4324698.90 4479476.28

6. Income (Corporate) Tax 0.00 0.00 1060879.93 1297409.67 1343842.89

7. NET PROFIT 6868.79 2431006.39 2475386.49 3027289.23 3135633.40

RATIOS (%)

Gross Profit/Sales 0.14% 36.83% 44.65% 49.14% 50.90%

Net Profit After Tax/Sales 0.14% 36.83% 31.25% 34.40% 35.63%

Return on Investment 16.64% 26.41% 25.33% 28.27% 27.91%

Return on Equity 0.13% 47.12% 47.98% 58.68% 60.78%

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Annex 4: NET INCOME STATEMENT (in Birr):Continued

PRODUCTION

6 7 8 9 10

Capacity Utilization (%) 100% 100% 100% 100% 100%

1. Total Income 8800000.00 8800000.00 8800000.00 8800000.00 8800000.00

Sales Revenue 8800000.00 8800000.00 8800000.00 8800000.00 8800000.00

Other Income 0.00 0.00 0.00 0.00 0.00

2. Less Variable Cost 2241689.06 2241689.06 2241689.06 2241689.06 2241689.06

VARIABLE MARGIN 6558310.94 6558310.94 6558310.94 6558310.94 6558310.94


3. Less Fixed Costs 1398487.50 1398487.50 1398487.50 1398487.50 1398487.50

OPERATIONAL MARGIN 5159823.44 5159823.44 5159823.44 5159823.44 5159823.44


4. Less Cost of Finance 309554.77 154777.39 0.00 0.00 0.00

5. GROSS PROFIT 4850268.67 5005046.05 5159823.44 5159823.44 5159823.44

6. Income (Corporate) Tax 1455080.60 1501513.82 1547947.03 1547947.03 1547947.03

7. NET PROFIT 3395188.07 3503532.24 3611876.41 3611876.41 3611876.41

RATIOS (%)

Gross Profit/Sales 55.12% 56.88% 58.63% 58.63% 58.63%

Net Profit After Tax/Sales 38.58% 39.81% 41.04% 41.04% 41.04%

Return on Investment 28.72% 28.36% 28.00% 28.00% 28.00%

Return on Equity 65.81% 67.91% 70.01% 70.01% 70.01%

Annex 5: Projected Balance Sheet (in Birr)

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Year 1 Year 2 1 2 3 4

TOTAL ASSETS 6090787.50 12898115.46 13432984.25 14766179.09 16095754.04 17929231.72

1. Total Current Assets 0.00 716540.46 2527424.25 5136634.09 7742224.04 10851716.72Inventory on Materials and Supplies 0.00 0.00 158304.48 215869.75 259043.70 287826.33

Work in Progress 0.00 0.00 57259.59 78081.26 93697.51 104108.35

Finished Products in Stock 0.00 0.00 114519.18 156162.52 187395.02 208216.69

Accounts Receivable 0.00 0.00 528000.00 720000.00 864000.00 960000.00

Cash in Hand 0.00 0.00 64014.00 87291.82 104750.18 116389.09

Cash Surplus, Finance Available 0.00 716540.46 1605327.00 3879228.75 6233337.63 9175176.26

Securities 0.00 0.00 0.00 0.00 0.00 0.00

2. Total Fixed Assets, Net of Depreciation 6090787.50 12181575.00 10905560.00 9629545.00 8353530.00 7077515.00

Fixed Investment 0.00 5800750.00 11601500.00 11601500.00 11601500.00 11601500.00

Construction in Progress 5800750.00 5800750.00 0.00 0.00 0.00 0.00

Pre-Production Expenditure 290037.50 580075.00 580075.00 580075.00 580075.00 580075.00

Less Accumulated Depreciation 0.00 0.00 1276015.00 2552030.00 3828045.00 5104060.00

3. Accumulated Losses Brought Forward 0.00 0.00 0.00 0.00 0.00 0.00

4. Loss in Current Year 0.00 0.00 0.00 0.00 0.00 0.00

TOTAL LIABILITIES 6090787.50 12898115.46 13432984.25 14766179.09 16095754.04 17929231.72

5. Total Current Liabilities 0.00 0.00 528000.00 720000.00 864000.00 960000.00


Bank Overdraft 0.00 0.00 0.00 0.00 0.00 0.00

6. Total Long-term Debt 3654472.50 7738869.28 7738869.28 6449057.73 5159246.18 3869434.64

Loan A 3654472.50 7738869.28 7738869.28 6449057.73 5159246.18 3869434.64

Loan B 0.00 0.00 0.00 0.00 0.00 0.00

7. Total Equity Capital 2436315.00 5159246.18 5159246.18 5159246.18 5159246.18 5159246.18

Ordinary Capital 2436315.00 5159246.18 5159246.18 5159246.18 5159246.18 5159246.18Preference Capital 0.00 0.00 0.00 0.00 0.00 0.00

Subsidies 0.00 0.00 0.00 0.00 0.00 0.00

8. Reserves, Retained Profits Brought Forward 0.00 0.00 0.00 6868.79 2437875.18 4913261.67

9.Net Profit After Tax 0.00 0.00 6868.79 2431006.39 2475386.49 3027289.23

Dividends Payable 0.00 0.00 0.00 0.00 0.00 0.00

Retained Profits 0.00 0.00 6868.79 2431006.39 2475386.49 3027289.23

Annex 5: Projected Balance Sheet (in Birr): Continued

PRODUCTION

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5 6 7 8 9 10

TOTAL ASSETS 19775053.58 21880430.10 24094150.79 27706027.20 31317903.61 34929780.01

1. Total Current Assets 13973553.58 17138930.10 20412650.79 25084527.20 29756403.61 34428280.01

Inventory on Materials and Supplies 287826.33 287826.33 287826.33 287826.33 287826.33 287826.33

Work in Progress 104108.35 104108.35 104108.35 104108.35 104108.35 104108.35

Finished Products in Stock 208216.69 208216.69 208216.69 208216.69 208216.69 208216.69Accounts Receivable 960000.00 960000.00 960000.00 960000.00 960000.00 960000.00

Cash in Hand 116389.09 116389.09 116389.09 116389.09 116389.09 116389.09

Cash Surplus, Finance Available 12297013.11 15462389.64 18736110.33 23407986.74 28079863.14 32751739.55

Securities 0.00 0.00 0.00 0.00 0.00 0.00

2. Total Fixed Assets, Net of Depreciation 5801500.00 4741500.00 3681500.00 2621500.00 1561500.00 501500.00

Fixed Investment 11601500.00 11601500.00 11601500.00 11601500.00 11601500.00 11601500.00

Construction in Progress 0.00 0.00 0.00 0.00 0.00 0.00

Pre-Production Expenditure 580075.00 580075.00 580075.00 580075.00 580075.00 580075.00

Less Accumulated Depreciation 6380075.00 7440075.00 8500075.00 9560075.00 10620075.00 11680075.00

3. Accumulated Losses Brought Forward 0.00 0.00 0.00 0.00 0.00 0.00

4. Loss in Current Year 0.00 0.00 0.00 0.00 0.00 0.00

TOTAL LIABILITIES 19775053.58 21880430.10 24094150.79 27706027.20 31317903.61 34929780.01

5. Total Current Liabilities 960000.00 960000.00 960000.00 960000.00 960000.00 960000.00


Bank Overdraft 0.00 0.00 0.00 0.00 0.00 0.00

6. Total Long-term Debt 2579623.09 1289811.55 0.00 0.00 0.00 0.00

Loan A 2579623.09 1289811.55 0.00 0.00 0.00 0.00

Loan B 0.00 0.00 0.00 0.00 0.00 0.00

7. Total Equity Capital 5159246.18 5159246.18 5159246.18 5159246.18 5159246.18 5159246.18

Ordinary Capital 5159246.18 5159246.18 5159246.18 5159246.18 5159246.18 5159246.18

Preference Capital 0.00 0.00 0.00 0.00 0.00 0.00

Subsidies 0.00 0.00 0.00 0.00 0.00 0.00

8. Reserves, Retained Profits BroughtForward 7940550.90 11076184.30 14471372.37 17974904.61 21586781.01 25198657.42

9. Net Profit After Tax 3135633.40 3395188.07 3503532.24 3611876.41 3611876.41 3611876.41

Dividends Payable 0.00 0.00 0.00 0.00 0.00 0.00

Retained Profits 3135633.40 3395188.07 3503532.24 3611876.41 3611876.41 3611876.41

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