Microsoft Corporation

Financial Analyis and Forecast

Drivers
Sceenario
Selected Case 1 1 Best Case
Date 5/12/2021 2 Base Case
Company Microsost Corp. 3 Worst Case
Currency $
Domestic Country US
10-year treasury yield 1.67%
Market Risk Premium US 5.60%
Company Beta 0.79
Microsoft share price 243.5
Bond Yield 3.3%
Corporate Tax Rate 28%
Expected Inflation 2.25%
INPUT -->
Profit and Loss Statement (Historical)
(In millions, except per share amounts)

2017 2018 2019 2020

Product 63,811.00 64,497.00 66,069.00 68,041.00
Service and other 32,760.00 45,863.00 59,774.00 74,974.00
Total revenue 96,571.00 110,360.00 125,843.00 143,015.00
Product -15,175.00 -15,420.00 -16,273.00 -16,017.00
Service and other -19,086.00 -22,933.00 -26,637.00 -30,061.00
Total cost of revenue -34,261.00 -38,353.00 -42,910.00 -46,078.00
Gross Profit 62,310.00 72,007.00 82,933.00 96,937.00
Research and development -13,037.00 -14,726.00 -16,876.00 -19,269.00
Sales and marketing -15,461.00 -17,469.00 -18,213.00 -19,598.00
General and administrative -4,481.00 -4,754.00 -4,885.00 -5,111.00
Impairment, integration, and restructuring -306.00 - - -
EBIT 29,025.00 35,058.00 42,959.00 52,959.00
Other income (expense), net 823.00 1,416.00 729.00 77.00
EBT 29,848.00 36,474.00 43,688.00 53,036.00
Provision for income taxes -4,412.00 -19,903.00 -4,448.00 -8,755.00
Net income 25,436.00 16,571.00 39,240.00 44,281.00

KPI's
Revenue Growth % Y-o-Y (Product) 1% 2% 3%
Revenue Growth % Y-o-Y (Service and Other) 40% 30% 25%
14% 14% 14%
GP% (Product) 76% 76% 75% 76%
GP% (Service and other) 42% 50% 55% 60%
Overall GP % 65% 65% 66% 68%
EBIT % 30% 32% 34% 37%
Net income % 26% 15% 31% 31%
ROA 39% 43% 44% 47%
ROE 110% 133% 123% 121%
Balance Sheet (Historical)
(In millions)

2017 2018 2019 2020

Cash and cash equivalents 7,663.00 11,946.00 11,356.00 13,576.00
Short-term investments 125,318.00 121,822.00 122,463.00 122,951.00
Total cash, cash equivalents, and short-term investments 132,981.00 133,768.00 133,819.00 136,527.00
Accounts receivable 22,431.00 26,481.00 29,524.00 32,011.00
Inventories 2,181.00 2,662.00 2,063.00 1,895.00
Other current assets 5,103.00 6,751.00 10,146.00 11,482.00
Total current assets 162,696.00 169,662.00 175,552.00 181,915.00
Property and equipment 23,734.00 29,460.00 36,477.00 44,151.00
Operating lease right-of-use assets 6,555.00 6,686.00 7,379.00 8,753.00
Equity investments 6,023.00 1,862.00 2,649.00 2,965.00
Goodwill 35,122.00 35,683.00 42,026.00 43,351.00
Intangible assets, net 10,106.00 8,053.00 7,750.00 7,038.00
Other long-term assets 6,076.00 7,442.00 14,723.00 13,138.00
Total assets 250,312.00 258,848.00 286,556.00 301,311.00

Accounts payable 7,390.00 8,617.00 9,382.00 12,530.00

Short-term debt 9,072.00 - - -
Current portion of long-term debt 1,049.00 3,998.00 5,516.00 3,749.00
Accrued compensation 5,819.00 6,103.00 6,830.00 7,874.00
Income taxes 718.00 2,121.00 5,665.00 2,130.00
Short-term unearned revenue 24,013.00 28,905.00 32,676.00 36,000.00
Securities lending payable -
Other current liabilities 7,684.00 8,744.00 9,351.00 10,027.00
Total current liabilities 55,745.00 58,488.00 69,420.00 72,310.00
Long-term debt 76,073.00 72,242.00 66,662.00 59,578.00
Long-term income taxes 13,485.00 30,265.00 29,612.00 29,432.00
Long-term unearned revenue 2,643.00 3,815.00 4,530.00 3,180.00
Deferred income taxes 5,734.00 541.00 233.00 204.00
Operating lease liabilities 5,372.00 5,568.00 6,188.00 7,671.00
Other long-term liabilities 3,549.00 5,211.00 7,581.00 10,632.00
Total liabilities 162,601.00 176,130.00 184,226.00 183,007.00
Common stock and paid-in capital – shares authorized 69,315.00 71,223.00 78,520.00 80,552.00
Retained earnings 17,769.00 13,682.00 24,150.00 34,566.00
Accumulated other comprehensive income (loss) 627.00 -2,187.00 -340.00 3,186.00
Total stockholders’ equity 87,711.00 82,718.00 102,330.00 118,304.00
Total liabilities and stockholders’ equity 250,312.00 258,848.00 286,556.00 301,311.00

KPI's
Liquidity ratios
Quick ratio 2.39 2.29 1.93 1.89
Current ratio 2.92 2.90 2.53 2.52
DSO 83.62 86.38 84.46 80.58
DIO 22.92 24.99 17.31 14.81
DPO 77.65 80.88 78.71 97.89
Net Trading Cycle 28.88 30.49 23.06 -2.51
Solvency ratios
Debt ratio 0.65 0.68 0.64 0.61
Workings -->
Revenue

2017 2018 2019 2020 2021 2022

ACT ACT ACT ACT FCST FCST
Total revenue 96571 110360 125843 143015 166,666 194,739
Product 63811 64497 66069 68041 n.a. n.a.
Service and other 32760 45863 59774 74974 n.a. n.a.

Y-o-Y Growth Revenue 14.28% 14.03% 13.65%

13.98%

Selected Case 16.54% 16.84%

Best Case 16.54% 16.84%

Base Case 13.50% 13.75%

Worst Case 10.46% 10.66%

 2023 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST FCST
228,017 267,541 314,736 368,713 431,947 506,026
n.a. n.a. n.a. n.a. n.a. n.a.
n.a. n.a. n.a. n.a. n.a. n.a.

17.09% 17.33% 17.64% 17.15% 17.15% 17.15%

17.09% 17.33% 17.64% 17.15% 17.15% 17.15%

13.95% 14.15% 14.40% 14.00% 14.00% 14.00%

10.81% 10.97% 11.16% 10.85% 10.85% 10.85%

COGS

2017 2018 2019 2020 2021

ACT ACT ACT ACT FCST
Total revenue 96571 110360 125843 143015 162322
Total cost of revenue -34261 -38353 -42910 -46078 -67,879
Product -15175 -15420 -16273 -16017 n.a.
Service and other -19086 -22933 -26637 -30061 n.a.

Y-o-Y Growth 11.94% 11.88% 7.38%

% as of Revenue 35.48% 34.75% 34.10% 32.22%
34.14%

Selected Case 41.82%

Best Case 41.82%

Base Case 34.14%

Worst Case 26.46%

 2022 2023 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST FCST FCST
184641 210399 240170 274755 313220 357071 407061
-77,213 -87,984 -100,433 -114,896 -130,981 -149,319 -170,223
n.a. n.a. n.a. n.a. n.a. n.a. n.a.
n.a. n.a. n.a. n.a. n.a. n.a. n.a.

41.82% 41.82% 41.82% 41.82% 41.82% 41.82% 41.82%

41.82% 41.82% 41.82% 41.82% 41.82% 41.82% 41.82%

34.14% 34.14% 34.14% 34.14% 34.14% 34.14% 34.14%

26.46% 26.46% 26.46% 26.46% 26.46% 26.46% 26.46%

OPEX

2017 2018 2019 2020 2021 2022

ACT ACT ACT ACT FCST FCST
Total revenue 96,571 110,360 125,843 143,015 166,666 194,739

Gross Profit 62,310 72,007 82,933 96,937 n.a. n.a.

Research and development -13,037 -14,726 -16,876 -19,269 n.a. n.a.

Sales and marketing -15,461 -17,469 -18,213 -19,598 n.a. n.a.
General and administrative -4,481 -4,754 -4,885 -5,111 n.a. n.a.
Impairment, integration, and rest -306 - - - n.a. n.a.

Total Operating Expense -33,285 -36,949 -39,974 -43,978 -66,590 -77,807

RD as a % of Revenue 13% 13% 13%

SM as % of Revenue 16% 14% 14%
GA as % of Revenue 4% 4% 4%

OPEX as % of Revenue 34.5% 33.5% 31.8% 30.8%

Selected Case 39.95% 39.95%

Best Case 39.95% 39.95%

Base Case 32.62% 32.62%

Worst Case 25.28% 25.28%

 2023 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST FCST
228,017 267,541 314,736 368,713 431,947 506,026

n.a. n.a. n.a. n.a. n.a. n.a.

n.a. n.a. n.a. n.a. n.a. n.a.

n.a. n.a. n.a. n.a. n.a. n.a.
n.a. n.a. n.a. n.a. n.a. n.a.
n.a. n.a. n.a. n.a. n.a. n.a.

-91,103 -106,894 -125,750 -147,316 -172,581 -202,179

39.95% 39.95% 39.95% 39.95% 39.95% 39.95%

39.95% 39.95% 39.95% 39.95% 39.95% 39.95%

32.62% 32.62% 32.62% 32.62% 32.62% 32.62%

25.28% 25.28% 25.28% 25.28% 25.28% 25.28%

Fixed Asset Roll Forward

Selected Case: Capex as % of PP&E 1

PP&E Schedule
2017 2018 2019 2020 2021
ACT ACT ACT ACT FCST
Beginning PP&E 23,734.00 29,460.00 36,477.00 44,151.00
Capex 15,987.00 18,699.00 20,470.00 25,305.75
D&A -8,778.00 -10,261.00 -11,682.00 -12,796.00 -6,945.68
Ending PP&E 23,734.00 29,460.00 36,477.00 44,151.00 62,511.08

Useful Life of Capex 10

Useful Life of Historical Assets 10

D&A Schedule
2017 2018 2019 2020 2021
ACT ACT ACT ACT FCST
-4,415.10
-2,530.58

Total -6,945.68

Capex as % of PP&E 67% 63% 56%

Capex as % of Revenue 14% 15% 14%

Selected Case
Capex as % of PP&E 57.32%
Capex as % of Revenue 12.55%

Best Case
Capex as % of PP&E 57.32%
Capex as % of Revenue 12.55%

Base Case
Capex as % of PP&E 62.32%
Capex as % of Revenue 14.55%

Worst Case
Capex as % of PP&E 67.32%
Capex as % of Revenue 16.55%
 2022 2023 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST FCST FCST
62,511.08 86,508.38 103,374.74 113,222.48 112,511.57 110,006.35 105,475.25
34,381.09 30,277.93 25,843.69 16,983.37 16,876.74 16,500.95 15,821.29
-10,383.78 -13,411.58 -15,995.95 -17,694.28 -19,381.96 -21,032.05 -22,614.18
86,508.38 103,374.74 113,222.48 112,511.57 110,006.35 105,475.25 98,682.35

2022 2023 2024 2025 2026 2027 2028

FCST FCST FCST FCST FCST FCST FCST
-4,415.10 -4,415.10 -4,415.10 -4,415.10 -4,415.10 -4,415.10 -4,415.10
-2,530.58 -2,530.58 -2,530.58 -2,530.58 -2,530.58 -2,530.58 -2,530.58
-3,438.11 -3,438.11 -3,438.11 -3,438.11 -3,438.11 -3,438.11 -3,438.11
-3,027.79 -3,027.79 -3,027.79 -3,027.79 -3,027.79 -3,027.79
-2,584.37 -2,584.37 -2,584.37 -2,584.37 -2,584.37
-1,698.34 -1,698.34 -1,698.34 -1,698.34
-1,687.67 -1,687.67 -1,687.67
-1,650.10 -1,650.10
-1,582.13
-10,383.78 -13,411.58 -15,995.95 -17,694.28 -19,381.96 -21,032.05 -22,614.18

55.00% 35.00% 25.00% 15.00% 15.00% 15.00% 15.00%

12.55% 12.55% 10.00% 10.00% 8.00% 8.00% 8.00%

55.00% 35.00% 25.00% 15.00% 15.00% 15.00% 15.00%

12.55% 12.55% 10.00% 10.00% 8.00% 8.00% 8.00%

60.00% 40.00% 30.00% 20.00% 20.00% 20.00% 20.00%

14.55% 14.55% 12.00% 12.00% 10.00% 10.00% 10.00%

65.00% 45.00% 35.00% 25.00% 25.00% 25.00% 25.00%

16.55% 16.55% 14.00% 14.00% 12.00% 12.00% 12.00%
Working Capital

2017 2018 2019 2020 2021 2022 2023

ACT ACT ACT ACT FCST FCST FCST
Accounts receivable ### 22,431.00 26,481.00 29,524.00 32,011.00 38,777.59 45,309.19 53,051.96
Inventories ### 2,181.00 2,662.00 2,063.00 1,895.00 3,771.87 4,290.50 4,889.02
Accounts payable ### 7,390.00 8,617.00 9,382.00 12,530.00 15,797.97 17,970.19 20,477.03
Net Working Capital 17,222.00 20,526.00 22,205.00 21,376.00 26,751.48 31,629.49 37,463.95

DSO 84 86 84 81 84 84 84
DIO 23 25 17 15 20 20 20
DPO 78 81 79 98 84 84 84
Net Trading Cycle 29 30 23 -3 20 20 20
 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST
62,247.86 73,228.38 85,787.04 100,499.52 117,735.19
5,580.82 6,384.46 7,278.28 8,297.24 9,458.85
23,374.53 26,740.47 30,484.13 34,751.91 39,617.18
44,454.14 52,872.37 62,581.19 74,044.85 87,576.86

84 84 84 84 84
20 20 20 20 20
84 84 84 84 84
20 20 20 20 20
Financing

Cover Negative Cash Flow with

Debt 50%
Equity 50%

Bond Yeild 3.30%

2017 2018 2019 2020 2021 2022

ACT ACT ACT ACT FCST FCST
Long term Debt 77,122.00 76,240.00 72,178.00 63,327.00 63,327.00 63,327.00
Interest Expense -2733 -2686 -2591 -2,089.79 -2,089.79
Interest Rate -2.8% -2.7% -2.4% 3.3% 3.3%

2017 2018 2019 2020 2021 2022

ACT ACT ACT ACT FCST FCST
Unlevered Free cashflow 18,164.82 16,742.73
Debt - -
Equity - -
 2023 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST FCST
63,327.00 63,327.00 63,327.00 63,327.00 63,327.00 63,327.00
-2,089.79 -2,089.79 -2,089.79 -2,089.79 -2,089.79 -2,089.79
3.3% 3.3% 3.3% 3.3% 3.3% 3.3%

2023 2024 2025 2026 2027 2028

FCST FCST FCST FCST FCST FCST
32,705.28 50,478.22 74,249.68 90,620.06 110,638.51 134,381.94
- - - - - -
- - - - - -
WACC
Risk free rate 1.67%
Beta 0.79
Market risk premium 5.6%
Tax rate 28.0%

Cost of Equity 6.09%

Cost of Debt 3.3%

2017 2018 2019 2020 2021

ACT ACT ACT ACT FCST
Equity 87,711 82,718 102,330 118,304 139,981
Debt 77,122 76,240 72,178 63,327 63,327
Total 164,833 158,958 174,508 181,631 203,308

Equity/Debt+Equity 0.53 0.52 0.59 0.65 0.69

Debt/Debt+Equity 0.47 0.48 0.41 0.35 0.31

Cost of Debt 3.3% 3.3% 3.3% 3.3% 3.3%

Cost of Equity 6.09% 6.09% 6.09% 6.09% 6.09%

WACC 4.11% 4.16% 3.91% 3.67% 3.53%

 2022 2023 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST FCST FCST
167,075 200,800 242,650 294,490 358,084 435,813 530,518
63,327 63,327 63,327 63,327 63,327 63,327 63,327
230,402 264,127 305,977 357,817 421,411 499,140 593,845

0.73 0.76 0.79 0.82 0.85 0.87 0.89

0.27 0.24 0.21 0.18 0.15 0.13 0.11

3.3% 3.3% 3.3% 3.3% 3.3% 3.3% 3.3%

6.09% 6.09% 6.09% 6.09% 6.09% 6.09% 6.09%

3.40% 3.27% 3.14% 3.03% 2.93% 2.85% 2.77%

Output -->
Profit and Loss Statement
(In millions)

2017 2018 2019 2020

ACT ACT ACT ACT
Revenue 96,571.00 110,360.00 125,843.00 143,015.00
COGS -34,261.00 -38,353.00 -42,910.00 -46,078.00
Gross Profit 62,310.00 72,007.00 82,933.00 96,937.00
Operating Expenses -33,285.00 -36,949.00 -39,974.00 -43,978.00
EBIT 29,025.00 35,058.00 42,959.00 52,959.00
Interest Expense -2,733.00 -2,686.00 -2,591.00
EBT 32,325.00 40,273.00 50,368.00
Taxes(28%) -9,051.00 -11,276.44 -14,103.04
Net Income 23,274.00 28,996.56 36,264.96

600,000.00

500,000.00

400,000.00

300,000.00

200,000.00

100,000.00

-
2018 2019 2020 2021 2022 2023
ACT ACT ACT FCST FCST FCST

Revenue Gross Profit EBIT Net Income

 2021 2022 2023 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST FCST FCST FCST
166,666.11 194,738.93 228,017.38 267,541.34 314,735.63 368,712.79 431,947.03 506,025.95
-67,879.14 -77,212.52 -87,983.67 -100,433.36 -114,895.76 -130,981.17 -149,318.53 -170,223.12
98,786.97 117,526.41 140,033.71 167,107.98 199,839.87 237,731.62 282,628.51 335,802.83
-66,590.21 -77,806.50 -91,102.66 -106,894.17 -125,750.30 -147,316.47 -172,581.25 -202,178.93
32,196.76 39,719.91 48,931.05 60,213.82 74,089.57 90,415.15 110,047.26 133,623.90
-2,089.79 -2,089.79 -2,089.79 -2,089.79 -2,089.79 -2,089.79 -2,089.79 -2,089.79
30,106.96 37,630.12 46,841.26 58,124.03 71,999.78 88,325.36 107,957.47 131,534.11
-8,429.95 -10,536.43 -13,115.55 -16,274.73 -20,159.94 -24,731.10 -30,228.09 -36,829.55
21,677.01 27,093.68 33,725.71 41,849.30 51,839.84 63,594.26 77,729.38 94,704.56

2022 2023 2024 2025 2026 2027

FCST FCST FCST FCST FCST FCST

ross Profit EBIT Net Income

Balance Sheet
(In millions)

2017 2018 2019 2020 2021

ACT ACT ACT ACT FCST
Cash and cash equivalents 7,663.00 11,946.00 11,356.00 13,576.00 30,236.17
Short-term investments 125,318.00 121,822.00 122,463.00 122,951.00 122,951.00
Accounts receivable 22,431.00 26,481.00 29,524.00 32,011.00 38,777.59
Inventories 2,181.00 2,662.00 2,063.00 1,895.00 3,771.87
Other current assets 5,103.00 6,751.00 10,146.00 11,482.00 11,455.13
as a % of Revenue 5% 6% 8% 8% 7%
Property and equipment 23,734.00 29,460.00 36,477.00 44,151.00 62,511.08
Operating lease right-of-use assets 6,555.00 6,686.00 7,379.00 8,753.00 8,753.00
Equity investments 6,023.00 1,862.00 2,649.00 2,965.00 2,965.00
Goodwill 35,122.00 35,683.00 42,026.00 43,351.00 43,351.00
Intangible assets, net 10,106.00 8,053.00 7,750.00 7,038.00 7,038.00
Other long-term assets 6,076.00 7,442.00 14,723.00 13,138.00 14,133.73
as a % of Revenue 6% 7% 12% 9% 8%
Total assets 250,312.00 258,848.00 286,556.00 301,311.00 345,943.57

Accounts payable 7,390.00 8,617.00 9,382.00 12,530.00 15,797.97

Short-term debt 9,072.00 - - - -
Accrued compensation 5,819.00 6,103.00 6,830.00 7,874.00 9,370.31
as a % of Revenue 6% 6% 5% 6% 6%
Income taxes 14,203.00 32,386.00 35,277.00 31,562.00 39,230.97
as a % of Revenue 15% 29% 28% 22% 24%
Long-term debt 77,122.00 76,240.00 72,178.00 63,327.00 63,327.00
Uneraned Revenue 26,656.00 32,720.00 37,206.00 39,180.00 47,588.19
as a % of Revenue 28% 30% 30% 27% 29%
Deferred income taxes 5,734.00 541.00 233.00 204.00 204.00
Other liabilities 16,605.00 19,523.00 23,120.00 28,330.00 30,444.11
as a % of Revenue 17% 18% 18% 20% 18%
Total liabilities 162,601.00 176,130.00 184,226.00 183,007.00 205,962.55
Total stockholders’ equity 87,711.00 82,718.00 102,330.00 118,304.00 139,981.01
Total liabilities and stockholders’ equity 250,312.00 258,848.00 286,556.00 301,311.00 345,943.57

Check - - - - -
 2022 2023 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST FCST FCST
45,474.26 76,674.89 125,648.46 198,393.49 287,508.90 396,642.77 529,520.05 Cashflow sheet
122,951.00 122,951.00 122,951.00 122,951.00 122,951.00 122,951.00 122,951.00 stays flat
45,309.19 53,051.96 62,247.86 73,228.38 85,787.04 100,499.52 117,735.19 working capital sheet
4,290.50 4,889.02 5,580.82 6,384.46 7,278.28 8,297.24 9,458.85 working capital sheet
13,384.60 15,671.86 18,388.39 21,632.10 25,342.00 29,688.16 34,779.67 grows as % of revenue
7% 7% 7% 7% 7% 7% 7%
86,508.38 103,374.74 113,222.48 112,511.57 110,006.35 105,475.25 98,682.35 Fixed asset roll forward
8,753.00 8,753.00 8,753.00 8,753.00 8,753.00 8,753.00 8,753.00 stays flat
2,965.00 2,965.00 2,965.00 2,965.00 2,965.00 2,965.00 2,965.00 stays flat
43,351.00 43,351.00 43,351.00 43,351.00 43,351.00 43,351.00 43,351.00 stays flat
7,038.00 7,038.00 7,038.00 7,038.00 7,038.00 7,038.00 7,038.00 stays flat
16,514.39 19,336.49 22,688.23 26,690.43 31,267.84 36,630.27 42,912.36 grows as % of revenue
8% 8% 8% 8% 8% 8% 8%
396,539.32 458,056.96 532,834.23 623,898.42 732,248.41 862,291.20 1,018,146.49

17,970.19 20,477.03 23,374.53 26,740.47 30,484.13 34,751.91 39,617.18 working capital sheet
- - - - - - - stays flat
10,948.62 12,819.60 15,041.72 17,695.08 20,729.78 24,284.94 28,449.81 grows as % of revenue
6% 6% 6% 6% 6% 6% 6%
45,838.94 53,672.24 62,975.65 74,084.56 86,790.06 101,674.56 119,111.75 grows as % of revenue
24% 24% 24% 24% 24% 24% 24%
63,327.00 63,327.00 63,327.00 63,327.00 63,327.00 63,327.00 63,327.00 financing sheet
55,603.83 65,105.83 76,391.11 89,866.50 105,278.61 123,333.89 144,485.65 grows as % of revenue
29% 29% 29% 29% 29% 29% 29%
204.00 204.00 204.00 204.00 204.00 204.00 204.00 stays flat
35,572.03 41,650.85 48,870.50 57,491.26 67,351.01 78,901.71 92,433.36 grows as % of revenue
18% 18% 18% 18% 18% 18% 18%
229,464.62 257,256.56 290,184.53 329,408.87 374,164.60 426,478.02 487,628.75
167,074.70 200,800.40 242,649.70 294,489.55 358,083.81 435,813.18 530,517.74
396,539.32 458,056.96 532,834.23 623,898.42 732,248.41 862,291.20 1,018,146.49

- - - - - - -
-
Cashflow Statement
(In millions)

2017 2018 2019 2020 2021

ACT ACT ACT ACT FCST
EBIT 35,058.00 42,959.00 52,959.00 32,196.76
Operating Taxes (28%) -9,816.24 -12,028.52 -14,828.52 -9,015.09
NOPAT 25,241.76 30,930.48 38,130.48 23,181.66
Add back D&A 10,261.00 11,682.00 12,796.00 6,945.68
Gross Cashflow 35,502.76 42,612.48 50,926.48 30,127.34

Trade Recievables -4,050.00 -3,043.00 -2,487.00 -6,766.59

Inventory -481.00 599.00 168.00 -1,876.87
Accounts Payables 1,227.00 765.00 3,148.00 3,267.97
Investment in Working Capital -3,304.00 -1,679.00 829.00 -5,375.48

Capex -15,987.00 -18,699.00 -20,470.00 -25,305.75

Other Assets 6,004.00 -18,837.00 -2,542.00 -968.86
Other Liabilities 13,184.00 11,393.00 4,484.00 19,687.58
Unlevered Free Cashflow 35,399.76 14,790.48 33,227.48 18,164.82

Interest expenses -2,733.00 -2,686.00 -2,591.00 -2,089.79

Delta Financial liabilities -882.00 -4,062.00 -8,851.00 -
Delta equity/Other equity movements -28,267.00 -9,384.56 -20,290.96 -
Tax adjustment 765.24 752.08 725.48 585.14
Net Cash Flow 4,283.00 -590.00 2,220.00 16,660.17

Opening cash. 13,576.00

net cash flow 16,660.17
closing cash 7,663.00 11,946.00 11,356.00 13,576.00 30,236.17

check - - - - -
 2022 2023 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST FCST FCST
39,719.91 48,931.05 60,213.82 74,089.57 90,415.15 110,047.26 133,623.90
-11,121.57 -13,700.69 -16,859.87 -20,745.08 -25,316.24 -30,813.23 -37,414.69
28,598.33 35,230.36 43,353.95 53,344.49 65,098.91 79,234.03 96,209.21
10,383.78 13,411.58 15,995.95 17,694.28 19,381.96 21,032.05 22,614.18
38,982.12 48,641.93 59,349.89 71,038.78 84,480.87 100,266.08 118,823.39

-6,531.60 -7,742.77 -9,195.89 -10,980.52 -12,558.67 -14,712.48 -17,235.67

-518.63 -598.52 -691.80 -803.64 -893.82 -1,018.96 -1,161.61
2,172.22 2,506.84 2,897.50 3,365.93 3,743.67 4,267.78 4,865.27
-4,878.01 -5,834.46 -6,990.19 -8,418.23 -9,708.83 -11,463.66 -13,532.01

-34,381.09 -30,277.93 -25,843.69 -16,983.37 -16,876.74 -16,500.95 -15,821.29

-4,310.12 -5,109.36 -6,068.26 -7,245.91 -8,287.31 -9,708.59 -11,373.61
21,329.84 25,285.10 30,030.47 35,858.41 41,012.07 48,045.63 56,285.46
16,742.73 32,705.28 50,478.22 74,249.68 90,620.06 110,638.51 134,381.94

-2,089.79 -2,089.79 -2,089.79 -2,089.79 -2,089.79 -2,089.79 -2,089.79

- - - - - - -
- - - - - - -
585.14 585.14 585.14 585.14 585.14 585.14 585.14
15,238.08 31,200.63 48,973.57 72,745.03 89,115.41 109,133.87 132,877.29

30,236.17 45,474.26 76,674.89 125,648.46 198,393.49 287,508.90 396,642.77

15,238.08 31,200.63 48,973.57 72,745.03 89,115.41 109,133.87 132,877.29
45,474.26 76,674.89 125,648.46 198,393.49 287,508.90 396,642.77 529,520.05

- - - - - - -
DCF

g (Perpetuity Growth) 2.25%

(In millions) 1
2017 2018 2019 2020 2021
ACT ACT ACT ACT FCST
Unlevered Free Cash Flow 18,164.82
Continuing Value

Discount Factor (WACC) 3.53%

Present Value of UFCF 17,545.04
Present Value of CV

Perpetuity Growth Rate Based Valuation

Total PV of Cashflow 446,514.35
PV of Continuing Value 3,983,106.67
Enterprise Value 4,429,621.01
+cash 13,576.00
-Financial Liabilities -63,327.00
Equity Value 4,379,870.01
Number of shares outstanding 7683
Price per Share 570.07
 2 3 4 5 6 7 8
2022 2023 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST FCST FCST
16,742.73 32,705.28 50,478.22 74,249.68 90,620.06 110,638.51 134,381.94
4,956,997.85

3.40% 3.27% 3.14% 3.03% 2.93% 2.85% 2.77%

15,660.82 29,699.08 44,598.51 63,945.51 76,185.46 90,899.75 107,980.19
3,983,106.67
CHARTS -->
Revenue & EBIT

2017 2018 2019 2020 2021 2022 2023 2024

ACT ACT ACT ACT FCST FCST FCST FCST
Revenue 96,571 110,360 125,843 143,015 166,666 194,739 228,017 267,541
EBIT 29,025 35,058 42,959 52,959 32,197 39,720 48,931 60,214
EBIT % 30.1% 31.8% 34.1% 37.0% 19.3% 20.4% 21.5% 22.5%

600,000

450,000

300,000

150,000

-
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
ACT ACT ACT ACT FCST FCST FCST FCST FCST FCST

Revenue EBIT EBIT %

 2025 2026 2027 2028
FCST FCST FCST FCST
314,736 368,713 431,947 506,026
74,090 90,415 110,047 133,624
23.5% 24.5% 25.5% 26.4%

40.0%

30.0%

20.0%

10.0%

0.0%
4 2025 2026 2027 2028
T FCST FCST FCST FCST

%
Cash Flows

2021 2022 2023 2024 2025 2026 2027

FCST FCST FCST FCST FCST FCST FCST
Unlevered Free Cash Flow 18165 16743 32705 50478 74250 90620 110639
Present Value of UFCF 17545 15661 29699 44599 63946 76185 90900

Cash Flows
280000
107980

210000 90900

76185

63946 134382
140000
110639
44599 90620
74250
70000 29699
50478
17545 15661 32705
18165 16743

0
2021 2022 2023 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST FCST FCST FCST

Unlevered Free Cash Flow Present Value of UFCF

 2028
FCST
134382
107980

107980

90900

134382
110639

2027 2028
FCST FCST
Working Capital

2017 2018 2019 2020 2021 2022 2023

ACT ACT ACT ACT FCST FCST FCST
Accounts receivable 22431 26481 29524 32011 38778 45309 53052
Inventories 2181 2662 2063 1895 3772 4290 4889
Accounts payable 7390 8617 9382 12530 15798 17970 20477
Net Working Capital 17222 20526 22205 21376 26751 31629 37464
DSO 84 86 84 81 84 84 84
DIO 23 25 17 15 20 20 20
DPO 78 81 79 98 84 84 84
Net Trading Cycle 29 30 23 -3 20 20 20

Working Capital Flow

120

100

80

60

40

20

0
2017 2018 2019 2020 2021 2022 2023 2024 2025
ACT ACT ACT ACT FCST FCST FCST FCST FCST

Net Working Capital DSO DIO DPO

 2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST
62248 73228 85787 100500 117735
5581 6384 7278 8297 9459
23375 26740 30484 34752 39617
44454 52872 62581 74045 87577
84 84 84 84 84
20 20 20 20 20
84 84 84 84 84
20 20 20 20 20

100000

75000

50000

25000

0
2024 2025 2026 2027 2028
FCST FCST FCST FCST FCST

IO DPO
DCF Results

Scenario 1 Best Case

Enterprise Value 4,429,621.01
CF's of Forecast Period 10.1%
Continuing Value 89.9%

Best Case Bas

10%

44,29,621 40

90%

CF's of Forecast Period Continuing Value CF's of Forecast Pe

Scenario 2 Base Case Scenario 3
Enterprise Value 4,097,717.03 Enterprise Value
CF's of Forecast Period 11.2% CF's of Forecast Period
Continuing Value 88.8% Continuing Value

Base Case Worst Case

40,97,717 36,15,589

CF's of Forecast Period Continuing Value CF's of Forecast Period Continuing Value
 Worst Case
3,615,589.90
12.5%
87.5%

Worst Case

36,15,589

ecast Period Continuing Value