Financial Modelling in Excel for the Power Sector

Many business models fail due to poor planning, haphazard development, inherent errors and lack the ability to provide clear financial analysis. This course shows delegates how to build a power model from a skeleton model incorporating a range of Excel and applied financial techniques. Featuring: Develop a power station case during the workshop Build an energy model from a blank template Financial analysis of case company Adding financial statements Valuation elements How to audit and check models Risk and sensitivity analysis Structuring and optimising techniques Clear presentation and analysis Course structure The course starts with a discussion of modelling techniques and 'best practice' and presents a case study for completion during the course. Each session focuses on a particular aspect of modelling and applies it to the case model. The course is practical to allow for maximum participation and questions during the sessions. Delegates will leave this intensive four-day course with the ability to effectively apply advanced modelling techniques in Excel and be able to build a comprehensive energy model. Course outcomes Principles of best practice modelling Understanding of a broad range of techniques Knowledge of financial functions and other function types Ability to design and build future models for own use, incorporating elements from the course 'The course was very revealing in terms of the functionalities in Excel on how dynamic a financial model can be developed' - SMC Global Power Holding Corporation 'The course is excellent, the style of teaching is quite efficient in getting details across. Overall course is a must-know for acquiring Excel skills as well as better understanding of the power sector' - Nigerian National Petroleum Corporation (NNPC)
Day 1 Introduction and overview Introduction Overview of the course Common modelling errors Systematic design method Model design and structure – key steps Case study outline Model sections Practical: reviewing model examples Model template Starting position Model layout and design Required sheets Input sheets Key Excel features and techniques Practical: producing a model framework using best practice Production forecast Production sales and volume Input prices and gross costs Practical: completing operating statements Fixed assets Depreciation of fixed assets Setting out schedules and workings Practical: CAPEX and depreciation schedules Day 2 Project financing and cash Financing and loans Loan drawdown Rate, terms and repayment Debt amortisation schedules Key financial functions Practical: loans schedule with balance sheet and income statement inputs Income statement and balance sheet Adding income and balance sheet Model checks on consistency Dealing with any circular references Practical: completing and checking the initial statements Tax and dividends Taxation methods Tax shield Dividend method Proving cash and overdraft Practical: adding tax and dividend sheets Cash flow International cash flow Cash flow to equity and debt providers Error checking Practical: cash flow and returns Day 3 Ratios and DCF Ratios Loan life / project life ratio Residual cover Annual debt service ratio Principal and debt cover Accounting ratios - profitability, liquidity, efficiency, structure Practical: ratios sheet Cost of capital Outline of cost of capital theory Capital asset pricing model constituents Discussion and agreement on WACC inputs Asset and equity betas and risk Mathematical derivation Practical: deriving beta from data and adding WACC to case Discounted cash flow Methods of adding terminal value Producing a project and equity NPV Practical: adding NPV to the template Auditing techniques Internal and external methods Complete model audit Practical: checking the model template Day 4 Risk, sensitivity and optimisation Macros and automation VBA in Excel Writing macros Checking and auditing macros Automating workbooks Practical: adding navigation and table of contents Risk and sensitivity Risk techniques in Excel Scenarios Sensitivity Charts What-if analysis and dynamic changes Practical: adding sensitivity and scenarios Optimum structure and targeting Achieving a target valuation Goal seek method Testing valuation with leverage and structure Practical: targeting the case to improve structure and result Management summary Producing management summary Returns analysis Required model documentation Tracking changes Questions and answers