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    Ocean - Carriers Revised 2011

    Uploaded by

    Prashant Mishra
    The document provides financial information for a new vessel over a 25 year period, including capital expenditures, book value, cash flows, and net present values discounted at 9% and 6%. It shows that in event year 0 (calendar year 2000), $3.9 million was spent on the vessel. Over the 25 years, the net present value of the cash flows is negative $6,023.90 when discounted at 9% and negative $35,347,134 when discounted at 6%.

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    Attribution Non-Commercial (BY-NC)
    Download as XLS, PDF, TXT or read online from Scribd

    Ocean - Carriers Revised 2011

    Uploaded by

    Prashant Mishra
    893 views7 pages
    The document provides financial information for a new vessel over a 25 year period, including capital expenditures, book value, cash flows, and net present values discounted at 9% and 6%. It shows that in event year 0 (calendar year 2000), $3.9 million was spent on the vessel. Over the 25 years, the net present value of the cash flows is negative $6,023.90 when discounted at 9% and negative $35,347,134 when discounted at 6%.

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    Ocean_Carriers Revised 2011

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    © Attribution Non-Commercial (BY-NC)

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    The document provides financial information for a new vessel over a 25 year period, including capital expenditures, book value, cash flows, and net present values discounted at 9% and 6%. It shows that in event year 0 (calendar year 2000), $3.9 million was spent on the vessel. Over the 25 years, the net present value of the cash flows is negative $6,023.90 when discounted at 9% and negative $35,347,134 when discounted at 6%.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as XLS, PDF, TXT or read online from Scribd
    Download as xls, pdf, or txt
    893 views7 pages

    Ocean - Carriers Revised 2011

    Uploaded by

    Prashant Mishra
    The document provides financial information for a new vessel over a 25 year period, including capital expenditures, book value, cash flows, and net present values discounted at 9% and 6%. It shows that in event year 0 (calendar year 2000), $3.9 million was spent on the vessel. Over the 25 years, the net present value of the cash flows is negative $6,023.90 when discounted at 9% and negative $35,347,134 when discounted at 6%.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as XLS, PDF, TXT or read online from Scribd
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    Cost of New Vessel

    Event Year

    Calendar
    Year

    Capital Expenditure

    Book Value

    Cash Flow

    2000

    3,900,000

    3,900,000

    (3,900,000)

    2001

    3,900,000

    7,800,000

    (3,900,000)

    2002

    31,200,000

    39,000,000

    (31,200,000)

    PV (CF) at 9 %

    PV (CF) at 6 %

    (3,900,000)

    (3,900,000)

    (3,577,982)

    (3,679,245)

    (26,260,416)

    (27,767,889)

    (33,738,398)

    (35,347,134)

    Cash Flow Recipe


    Line Item
    Revenues
    sub Operating Expenses
    sub Depreciation
    equals Operating Income (EBIT)
    sub Taxes
    equals EBIAT
    plus Depreciation
    sub Capital Expenditure
    sub Change in Net Working Capital
    plus After-Tax Proceeds from Sale of Equipment
    equals Cash Flow

    Calculation
    Daily Hire Rate * Days Hired
    Daily Operating Costs * 365 Days in Year
    $39MM / 25 Years + 1/5 CAPX(t-1)

    35% or 0 % of EBIT

    From Above
    Given in Exhibit 1
    Initially , NWC = $500,000; grows at inflation rate of 3 %
    Sale Price - Tax Rate * (Sale Price - Book Value)

    Operating Cash Flows ($ Thousands)


    Book Value of Ship
    Annual Depreciation
    Tax Rate
    Expected Inflation Rate
    Discount Rate
    Life

    Age of
    Ship

    1
    2
    3
    4
    5
    6
    7
    8
    9
    10
    11
    12
    13
    14
    15
    16
    17
    18
    19
    20
    21
    22
    23
    24
    25

    Event
    Year
    0
    1
    2
    3
    4
    5
    6
    7
    8
    9
    10
    11
    12
    13
    14
    15
    16
    17
    18
    19
    20
    21
    22
    23
    24
    25
    26
    27

    39,000
    1,560
    35.0%
    3.0%
    9.0%
    25

    Year

    2000
    2001
    2002
    2003
    2004
    2005
    2006
    2007
    2008
    2009
    2010
    2011
    2012
    2013
    2014
    2015
    2016
    2017
    2018
    2019
    2020
    2021
    2022
    2023
    2024
    2025
    2026
    2027

    Daily Hire Daily Oper


    Rate
    Costs

    20,000
    20,200
    20,400
    18,714
    17,283
    17,481
    17,682
    17,886
    18,092
    17,428
    17,628
    17,931
    18,036
    18,243
    14,762
    14,932
    15,104
    15,278
    15,454
    14,654
    14,823
    14,993
    15,166
    15,341
    13,448

    4,000
    4,160
    4,326
    4,499
    4,679
    4,867
    5,061
    5,264
    5,474
    5,693
    5,921
    6,158
    6,404
    6,660
    6,927
    7,204
    7,492
    7,792
    8,103
    8,427
    8,764
    9,115
    9,480
    9,859
    10,253

    Days
    Hired

    357
    357
    357
    357
    357
    353
    353
    353
    353
    353
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349

    Rev

    7,140
    7,211
    7,283
    6,681
    6,170
    6,171
    6,242
    6,314
    6,386
    6,152
    6,152
    6,258
    6,295
    6,367
    5,152
    5,211
    5,271
    5,332
    5,393
    5,114
    5,173
    5,233
    5,293
    5,354
    4,693

    Oper
    Costs

    1,460
    1,518
    1,579
    1,642
    1,708
    1,776
    1,847
    1,921
    1,998
    2,078
    2,161
    2,248
    2,338
    2,431
    2,528
    2,629
    2,735
    2,844
    2,958
    3,076
    3,199
    3,327
    3,460
    3,598
    3,742

    Deprec

    1,560
    1,560
    1,560
    1,560
    1,560
    1,620
    1,620
    1,620
    1,620
    1,620
    1,630
    1,630
    1,630
    1,630
    1,630
    1,710
    1,710
    1,710
    1,710
    1,710
    1,730
    1,730
    1,730
    1,730
    1,730

    Tax

    1,442
    1,447
    1,450
    1,218
    1,016
    971
    971
    970
    969
    859
    826
    833
    814
    807
    348
    305
    289
    272
    254
    115
    85
    61
    36
    9
    (273)

    EBIAT

    2,678
    2,686
    2,693
    2,261
    1,886
    1,803
    1,803
    1,802
    1,799
    1,595
    1,535
    1,547
    1,513
    1,499
    646
    567
    537
    506
    472
    213
    159
    114
    67
    1
    (506)

    Deprec

    1,560
    1,560
    1,560
    1,560
    1,560
    1,620
    1,620
    1,620
    1,620
    1,620
    1,630
    1,630
    1,630
    1,630
    1,630
    1,710
    1,710
    1,710
    1,710
    1,710
    1,730
    1,730
    1,730
    1,730
    1,730

    CAPX

    300

    350

    750

    850

    After-Tax
    Changes
    Proceeds
    in NWC
    from Sale

    500
    15
    15
    16
    16
    17
    17
    18
    18
    19
    20
    20
    21
    21
    22
    23
    23
    24
    25
    26
    26
    27
    28
    29
    30
    (1,016)

    4,368

    Cash
    Flow

    (500)
    4,223
    4,231
    4,237
    3,805
    3,129
    3,406
    3,405
    3,404
    3,400
    2,846
    3,145
    3,156
    3,121
    3,107
    1,503
    2,253
    2,223
    2,191
    2,156
    1,047
    1,862
    1,816
    1,768
    1,701
    6,608

    PV
    NPV
    NPV

    PV(CF)

    (421)
    3,261
    2,997
    2,754
    2,268
    1,711
    1,709
    1,567
    1,437
    1,317
    1,010
    1,024
    936
    855
    781
    346
    476
    431
    389
    351
    156
    255
    228
    203
    181
    643

    NWC

    500
    515
    530
    546
    563
    580
    597
    615
    633
    652
    672
    692
    713
    734
    756
    779
    802
    826
    851
    877
    903
    930
    958
    987
    1,016
    -

    26,865
    -6873
    ($6,023.90)

    Book
    Value

    Scrap
    Value

    3,900
    7,800
    39,000
    37,440
    35,880
    34,320
    32,760
    31,500
    29,880
    28,260
    26,640
    25,020
    23,750
    22,120
    20,490
    18,860
    17,230
    16,350
    14,640
    12,930
    11,220
    9,510
    8,650
    6,920
    5,190
    3,460
    1,730
    -

    3,306
    3,405
    3,507
    3,612
    3,720
    3,832
    3,947
    4,065
    4,187
    4,313
    4,442
    4,576
    4,713
    4,851
    5,000
    5,150
    5,305
    5,464
    5,628
    5,796
    5,970
    6,149
    6,334
    6,524
    6,720

    3,260.93
    2,997.35
    2,754.06
    2,268.62
    1,711.91
    1,709.37
    1,567.96
    1,437.75
    1,317.78
    1,011.70
    1,025.67
    944.55
    856.89
    782.49
    347.35
    477.70

    3260.9308
    2997.3471
    2754.0635
    2268.6164
    1711.9118
    1709.368
    1567.9575
    1437.7492

    2,066.97
    1,871.32
    1,691.83
    1,527.51
    680.52
    1,110.03
    993.53
    887.36
    783.37
    4368 946.20021
    12,558.62

    Operating Cash Flows ($ Thousands)


    Book Value of Ship
    Annual Depreciation
    Tax Rate
    Expected Inflation Rate
    Discount Rate
    Life

    Age of
    Ship

    1
    2
    3
    4
    5
    6
    7
    8
    9
    10
    11
    12
    13
    14
    15
    16
    17
    18
    19
    20
    21
    22
    23
    24
    25

    Event
    Year
    0
    1
    2
    3
    4
    5
    6
    7
    8
    9
    10
    11
    12
    13
    14
    15
    16
    17
    18
    19
    20
    21
    22
    23
    24
    25
    26
    27

    Year
    2000
    2001
    2002
    2003
    2004
    2005
    2006
    2007
    2008
    2009
    2010
    2011
    2012
    2013
    2014
    2015
    2016
    2017
    2018
    2019
    2020
    2021
    2022
    2023
    2024
    2025
    2026
    2027

    39,000
    1,560
    0.0%
    3.0%
    9.0%
    25

    Daily Hire
    Rate

    20,200
    20,200
    20,400
    18,714
    17,283
    17,481
    17,682
    17,886
    18,092
    17,428
    17,628
    17,931
    18,036
    18,243
    14,762
    14,932
    15,104
    15,278
    15,454
    14,654
    14,823
    14,993
    15,166
    15,341
    13,448

    Daily
    Oper
    Costs

    4,000
    4,161
    4,329
    4,503
    4,685
    4,874
    5,070
    5,274
    5,487
    5,708
    5,938
    6,177
    6,426
    6,685
    6,955
    7,235
    7,527
    7,830
    8,145
    8,474
    8,815
    9,170
    9,540
    9,924
    10,234

    Days
    Hired

    357
    357
    357
    357
    357
    353
    353
    353
    353
    353
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349
    349

    Rev

    7,140
    7,211
    7,283
    6,681
    6,170
    6,171
    6,242
    6,314
    6,386
    6,152
    6,152
    6,223
    6,295
    6,367
    5,152
    5,211
    5,271
    5,332
    5,393
    5,114
    5,173
    5,233
    5,293
    5,354
    4,693

    Oper
    Costs

    1,460
    1,519
    1,580
    1,644
    1,710
    1,779
    1,851
    1,925
    2,003
    2,083
    2,167
    2,255
    2,346
    2,440
    2,538
    2,641
    2,747
    2,858
    2,973
    3,093
    3,218
    3,347
    3,482
    3,622
    3,768

    Deprec

    1,560
    1,560
    1,560
    1,560
    1,560
    1,620
    1,620
    1,620
    1,620
    1,620
    1,630
    1,630
    1,630
    1,630
    1,630
    1,710
    1,710
    1,710
    1,710
    1,710
    1,730
    1,730
    1,730
    1,730
    1,730

    Tax

    EBIAT Deprec

    4,120
    4,132
    4,143
    3,477
    2,900
    2,772
    2,771
    2,769
    2,763
    2,449
    2,355
    2,338
    2,319
    2,297
    984
    860
    814
    764
    710
    311
    225
    156
    81
    1
    (805)

    1,560
    1,560
    1,560
    1,560
    1,560
    1,620
    1,620
    1,620
    1,620
    1,620
    1,630
    1,630
    1,630
    1,630
    1,630
    1,710
    1,710
    1,710
    1,710
    1,710
    1,730
    1,730
    1,730
    1,730
    1,730

    CAPX

    300

    350

    750

    850

    After-Tax
    Changes
    Proceeds
    in NWC
    from Sale

    500
    15
    15
    16
    16
    17
    17
    18
    18
    19
    20
    20
    21
    21
    22
    23
    23
    24
    25
    26
    26
    27
    28
    29
    30
    (1,016)

    6,720

    Cash
    Flow

    (500)
    5,665
    5,677
    5,687
    5,021
    4,143
    4,375
    4,373
    4,371
    4,364
    3,699
    3,965
    3,947
    3,928
    3,905
    1,841
    2,547
    2,500
    2,449
    2,394
    1,145
    1,928
    1,858
    1,782
    1,701
    8,661

    PV
    NPV

    PV(CF)

    (421)
    4,374
    4,022
    3,696
    2,994
    2,266
    2,196
    2,014
    1,846
    1,691
    1,315
    1,293
    1,181
    1,078
    983
    425
    540
    486
    437
    392
    172
    266
    235
    207
    181
    845

    NWC

    500
    515
    530
    546
    562
    579
    596
    614
    632
    651
    671
    691
    712
    733
    755
    778
    801
    825
    850
    876
    902
    929
    957
    986
    1,016
    -

    34,714
    976

    Book Value
    3,900
    7,800
    39,000
    37,440
    35,880
    34,320
    32,760
    31,500
    29,880
    28,260
    26,640
    25,020
    23,750
    22,120
    20,490
    18,860
    17,230
    16,350
    14,640
    12,930
    11,220
    9,510
    8,650
    6,920
    5,190
    3,460
    1,730
    -

    Scrap
    Value

    3,306
    3,405
    3,507
    3,612
    3,720
    3,832
    3,947
    4,065
    4,187
    4,313
    4,442
    4,576
    4,713
    4,851
    5,000
    5,150
    5,305
    5,464
    5,628
    5,796
    5,970
    6,149
    6,334
    6,524
    6,720

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