wood poles

7/28/2019 Wood Poles

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Investment Office ANRS

Project Profile on the Production

Of chemically Treated Wood poles

Development Studies


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Development Studies

Table of Contents

1.Executive Summary..............................................................................................4

2.Product Description and Application.................................................................43.Market Study, Plant Capacity and Production Program.................................5

3.1Market Study...........................................................................................................................5

3.1.1Present Demand and Supply............................................................................................5

3.1.2Projected Demand............................................................................................................73.1.3Pricing and Distribution...................................................................................................8

3.2Plant Capacity.........................................................................................................................9

3.3Production Program................................................................................................................9

4.Raw Materials and Utilities.................................................................................9

4.1Availability and Source of Raw Materials..............................................................................9

4.2Annual Requirement and Cost of Raw Materials and Utilities...............................................9

5Location and Site.................................................................................................10

6Technology and Engineering .............................................................................10

6.1Production Process................................................................................................................10

6.2Machinery and Equipment....................................................................................................11

6.3Civil Engineering Cost..........................................................................................................11


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1. Executive Summary

This project profile deals with the establishment of production of chemically treated wood poles

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

Demand projection divulges that there is ample demand for wooden poles and is increasing with

time. Accordingly, the planned plant is set to produce 3,000 wooden poles annually. The total

investment cost of the project including working capital is estimated at birr 720.26 thousand and

creates 13 job opportunity and birr 125.28 thousand 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 18.9% of capacity utilization and it will

payback fully the initial investment less working capital in one year and 9 months. The result

further show that the calculated IRR of the project is 43.8% and NPV discounted at 18% of birr

654,980.77

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

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

Generally the project is technically feasible, financially and commercially viable as well as

socially and economically acceptable. Hence the project is worth implementing.


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As wood is light, its handling and transportation is easy and cheap even in extreme

circumstances. This means considerable savings in haulage and erecting costs compared with

concrete or steel poles.

II. Tough

Chemically treated (impregnated) wooden poles are tough. This is an important benefit in

transportation and storage of poles. Steel and concrete poles are much more sensitive to dents,

scratches and scars.

III. Easily workableHoles, notches and joints for fixing cross arms and kicking blocks can easily be made at the line

erection site, using simple hand tools - a practical benefit offered only by wooden poles.

IV. Maintenance free

A wooden pole is maintenance-free for decades while steel and concrete poles are much more

sensitive to corrosion, for instance.

V. Safe in useA dry wood pole conducts no electricity and is safe in the event of current leakages.


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Chemically treated wooden poles are mostly used to carry electric and telephone lines.

Nonetheless, with the introduction of wireless telephone connections in the country, the demand

for the pole is now mainly comes from the electricity industry.

Generally speaking, there is limited access to electricity, especially in the rural part of the country

which constitutes a major barrier to economic development and to the provision of social services in

rural areas. However, following the establishment of Rural Electrification Program in 2005, the

government is undergoing a massive electrification investment in an effort to light numerous

rural townships and localities. The objective of this program is to increase coverage of

electrification from 15% (in 2005) to 50% in the year 2011. Available report shows that at the

end of August 2007 the total coverage of electricity in the country has grown to 22pc. This

percentage is expected to increase in this year as well when we include the ongoing

electrification process of 1,714 towns.

Chemically treated wooden poles are one of materials highly demanded in the rural

electrification program since it has several advantages as explained in the previous section. The

Ethiopian Electric and Power Corporation (EEPCO) has got 4 wooden poles treatment plants (in

Addis Ababa, Shashemene, Bahir Dar and Nekemte) of which the 2 plants have been established

very recently. But as the demand for pole is usually higher than the supply, the corporation has

been outsourcing the work for local firms on bid basis. Some private wood work plants such as


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The foregoing analysis indicates that although there is huge demand for electric poles, the

presence of high cost of treatment is forcing the corporation to absorb much of the work and also

offer international bidders as part of cost minimization attempt. .

3.1.2 Projected Demand

The future demand for wooden poles is expected to increase tremendously due to the ongoing

rural electrification program. If we sum the current production volume of the corporation (about

78,000) and the import demand (22,782), the current demand for wooden pole is estimated to be

100,782. According to EEPCO, the annual growth rate of electrical demand is about 17%.

Taking this percentage point the future demand for the pole is forecasted as shown in table 1

below.

Table 1: Projected Demand for Wooden Poles

Year Projected Demand

2007/08 100,782

2008/09 117,9152009/10 137,960

2010/11 161,414

2011/12 188 854


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The above table shows the presence of huge demand for wooden pole in the future. It also

suggests the relevance of participating in such investment activities with cost effective approach.

3.1.3 Pricing and Distribution

Based on the market research result and the capacity of the envisaged plant, the selling price of a

10 meter tall wooden pole is set to be birr 450


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3.2 Plant Capacity

In consideration of the expected demand for chemically treated wooden poles as presented

earlier, and the planned technology, the envisaged plant is set to produce 3,000 wooden poles

annually.

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 75 percent capacity and then it grows to 90

percent in the 2nd year. The capacity will grow to 100 percent starting from the 3rd year. This

consideration is developed based on the assumption that the market already exists and logistics

barriers would be eliminated within the first two years of operation.

4. Raw Materials and Utilities

4.1 Availability and Source of Raw Materials

The main raw materials used in the production of chemically treated wooden poles are wood and

chemicals. While the chemical is imported from abroad, the rest of the raw material is available


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Table 2: Material and Utility Requirement

Material and Input Quantity

Total Cost

L.C. F.C.

Copper Sulphate 2,400 kg 72,000

Wooden Pole (10 mt) 3,000 pcs 600,000

Total Material Cost 600,000 72,000

Utility

Electricity 20,000 kwh 11,000

Furnace Oil 15,000 105,000

Water 2,500m3 3,975

Total Utility Cost 119,975

According to the above table, the cost of material and utility at full capacity of operation is

estimated to be birr 881,975 per year.

5 Location and Site

The appropriate locations for the envisaged project in view of the availability of input

is any localities where there are natural and man-made forests. This mainly includes North Shoa,

Awi and North Gonder zones.

6 Technology and Engineering


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6.2 Machinery and Equipment

The machineries and equipment required for producing chemically treated wooden poles is

presented in table 3 below

Table 3: Machinery and Equipment

The, total cost of tools and equipment including freight insurance and bank cost is estimated to

be about birr 75,000

The following are some of the machineries suppliers address for the envisaged project

Hamco manufacturing company

Phone: 886-4-7633112

Machinery and Equipment Quantity

Wood Treating Equipment 1Circular Saw 5

Various Hand Tools As required


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The total site area for the envisaged plant is estimated to be 400m 2 where 200m2 is allocated to

the shade used as production place and the remaining space is left for stores (150m 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 4 below

Table 4: Human Resource Requirement

Position

No.

Required

Monthly

Salary

TotalAnnual

SalaryManager 1 3500 42000

Accountant/Cashier 1 1000 12000

Store Keeper 1 600 7200

Skilled Operator 2 600 14400

Laborers 6 300 21600

Guards 2 300 7200

Benefit (20%) 20880

Total 13 125280


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8 Financial Analysis

8.1 Underlying Assumption

The financial analysis of chemically treated wooden poles making plant is based on the data

provided in the preceding chapters and the following assumptions.

A. Construction and Finance

Construction period 2 year

Source of finance 40% equity and 60% loan

Tax holidays 2 years

Bank interest rate 12%

Discount for cash flow 18%

Value of land Based on lease rate of ANRS

Spare Parts, Repair & Maintenance 1% of fixed investment

B. Depreciation

Building 5%

Machinery and equipment 10%


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Accounts Receivable 30

Cash in Hand 30

Accounts Payable 30

8.2 Investment

The total investment cost of the project including working capital is estimated at Birr 720.26

thousand as shown in table 5 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 5: Total initial investment

Items L.C F.C Total

Land 1,200 1,200Building and civil works

400,000 400,000

Office equipment15,000 15,000

Vehicles0 0

Plant machinery & equipment20,000 55,000 75,000

Total fixed investment cost 436,200 55,000 491,200

Pre production capital

expenditure* 24,560 24,560


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IV. Simple Rate of Return

For the envisaged plant the simple rate of return equals to 38.4%


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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 is43.8% and the net present value at 18 % discount is Birr 654,980.77

VI. Sensitivity Analysis

The envisaged plant is profitable even with considerable cost increment. That is the plant

maintains to be profitable starting from the first year when 10 % cost increment takes place inthe sector. This result is accompanied with payback period of 2 years.

9 Economic and Social Benefit and Justification

The envisaged project possesses wide range of benefits where it promotes the socio-economic

goals and objectives stated in the strategic plan of the Amhara National Regional State. It also

boosts the inter sectorial linkage between the agricultural/forestery and industrial sector. At the

same time, therefore, it helps diversify the economic activity of the region. The other major

benefits are listed as follows:

A. Profit Generation

The project is found to be financially viable and earns a profit of birr 2.53 million within the

j t lif S h lt i d th j t t t i t th fit hi h th f


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C. Employment and Income Generation

The proposed project is expected to create employment opportunity to several citizens of theregion. That is, it will provide permanent employment to 13 professionals as well as support

stuffs. Consequently the project creates income of birr 125.28 thousands per year. This would be

one of the commendable accomplishments of the project.

D. Pro Environment Project

The proposed production process is environment friendly.


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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 (%) 0.00 0.00 75% 90% 100% 100%

1. Total Inventory 0.00 0.00 205965.49 247158.59 274620.66 274620.66

Raw Materials in Stock- Total 0.00 0.00 72654.55 87185.45 96872.73 96872.73

Raw Material-Local 0.00 0.00 49090.91 58909.09 65454.55 65454.55

Raw Material-Foreign 0.00 0.00 23563.64 28276.36 31418.18 31418.18

Factory Supplies in Stock 0.00 0.00 782.25 938.70 1043.00 1043.00

Spare Parts in Stock and Maintenance 0.00 0.00 1205.67 1446.81 1607.56 1607.56

Work in Progress 0.00 0.00 19556.16 23467.39 26074.88 26074.88

Finished Products 0.00 0.00 39112.32 46934.79 52149.76 52149.76

2. Accounts Receivable 0.00 0.00 110454.55 132545.45 147272.73 147272.73

3. Cash in Hand 0.00 0.00 20066.32 24079.58 26755.09 26755.09

CURRENT ASSETS 0.00 0.00 263831.81 316598.17 351775.75 351775.75

4. Current Liabilities 0.00 0.00 110454.55 132545.45 147272.73 147272.73

Accounts Payable 0.00 0.00 110454.55 132545.45 147272.73 147272.73

TOTAL NET WORKING CAPITAL REQUIRMENTS 0.00 0.00 153377.27 184052.72 204503.02 204503.02

INCREASE IN NET WORKING CAPITAL 0.00 0.00 153377.27 30675.45 20450.30 0.00

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 274620.66 274620.66 274620.66 274620.66 274620.66 274620.66

Raw Materials in Stock-Total 96872.73 96872.73 96872.73 96872.73 96872.73 96872.73

Raw Material-Local 65454.55 65454.55 65454.55 65454.55 65454.55 65454.55

Raw Material-Foreign 31418.18 31418.18 31418.18 31418.18 31418.18 31418.18

Factory Supplies in Stock 1043.00 1043.00 1043.00 1043.00 1043.00 1043.00

Spare Parts in Stock and Maintenance 1607.56 1607.56 1607.56 1607.56 1607.56 1607.56

Work in Progress 26074.88 26074.88 26074.88 26074.88 26074.88 26074.88

Finished Products 52149.76 52149.76 52149.76 52149.76 52149.76 52149.76

2. Accounts Receivable 147272.73 147272.73 147272.73 147272.73 147272.73 147272.73

3. Cash in Hand 26755.09 26755.09 26755.09 26755.09 26755.09 26755.09

CURRENT ASSETS 351775.75 351775.75 351775.75 351775.75 351775.75 351775.75

4. Current Liabilities 147272.73 147272.73 147272.73 147272.73 147272.73 147272.73


TOTAL NET WORKING CAPITAL REQUIRMENTS 204503.02 204503.02 204503.02 204503.02 204503.02 204503.02

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)


Year 1 Year 2 1 2 3 4

TOTAL CASH INFLOW257880.00 462383.02 1122954.55 1237090.91 1364727.27 1350000.00

1. Inflow Funds 257880.00 462383.02 110454.55 22090.91 14727.27 0.00

Total Equity 103152.00 184953.21 0.00 0.00 0.00 0.00

Total Long Term Loan 154728.00 277429.81 0.00 0.00 0.00 0.00

Total Short Term Finances 0.00 0.00 110454.55 22090.91 14727.27 0.00

2. Inflow Operation 0.00 0.00 1012500.00 1215000.00 1350000.00 1350000.00

Sales Revenue 0.00 0.00 1012500.00 1215000.00 1350000.00 1350000.00

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 257880.00 257880.00 1076299.02 1016267.81 1184889.78 1143661.99

4. Increase In Fixed Assets 257880.00 257880.00 0.00 0.00 0.00 0.00

Fixed Investments 245600.00 245600.00 0.00 0.00 0.00 0.00

Pre-production Expenditures 12280.00 12280.00 0.00 0.00 0.00 0.00

5. Increase in Current Assets 0.00 0.00 263831.81 52766.36 35177.57 0.00

6. Operating Costs 0.00 0.00 700593.84 839616.21 932297.79 932297.79

7. Corporate Tax Paid 0.00 0.00 0.00 0.00 102172.33 104765.28

8. Interest Paid 0.00 0.00 111873.37 51858.94 43215.78 34572.63

9. Loan Repayments 0.00 0.00 0.00 72026.30 72026.30 72026.3010. Dividends Paid 0.00 0.00 0.00 0.00 0.00 0.00

Surplus(Deficit) 0.00 204503.02 46655.52 220823.10 179837.50 206338.01

Cumulative Cash Balance 0.00 204503.02 251158.55 471981.64 651819.14 858157.15

3


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

PRODUCTION

5 6 7 8 9 10

TOTAL CASH INFLOW 1350000.00 1350000.00 1350000.00 1350000.00 1350000.00 1350000.00

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 1350000.00 1350000.00 1350000.00 1350000.00 1350000.00 1350000.00


3. Other Income 0.00 0.00 0.00 0.00 0.00 0.00

TOTAL CASH OUTFLOW 1137611.78 1133035.17 1126984.96 1048908.45 1048908.45 1048908.454. Increase In Fixed Assets 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 932297.79 932297.79 932297.79 932297.79 932297.79 932297.79


8. Interest Paid 25929.47 17286.31 8643.16 0.00 0.00 0.00

9. Loan Repayments 72026.30 72026.30 72026.30 0.00 0.00 0.00

10. Dividends Paid 0.00 0.00 0.00 0.00 0.00 0.00

Surplus(Deficit) 212388.22 216964.83 223015.04 301091.55 301091.55 301091.55

Cumulative Cash Balance 1070545.36 1287510.19 1510525.22 1811616.77 2112708.32 2413799.86

4


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Annex 3: DISCOUNTED CASH FLOW-TOTAL CAPITAL INVESTED


Year 1 Year 2 1 2 3 4



Sales Revenue 0.00 0.00 1012500.00 1215000.00 1350000.00 1350000.00


2. Other Income 0.00 0.00 0.00 0.00 0.00 0.00


3. Increase in Fixed Assets 257880.00 257880.00 0.00 0.00 0.00 0.00



4. Increase in Net Working Capital 0.00 0.00 153377.27 30675.45 20450.30 0.00

5. Operating Costs 0.00 0.00 700593.84 839616.21 932297.79 932297.79


NET CASH FLOW -257880.00 -257880.00 158528.89 344708.34 397251.91 312936.93

CUMMULATIVE NET CASH FLOW -257880.00 -515760.00 -357231.11 -12522.77 384729.13 697666.07

Net Present Value (at 18%) -257880.00 -218542.37 113852.98 209800.14 204898.11 136787.62

Cumulative Net present Value -257880.00 -476422.37 -362569.39 -152769.26 52128.86 188916.48

5


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

PRODUCTION

5 6 7 8 9 10



Sales Revenue 1350000.00 1350000.00 1350000.00 1350000.00 1350000.00 1350000.00


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

Fixed Investments0.00 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 932297.79 932297.79 932297.79 932297.79 932297.79 932297.79


NET CASH FLOW 310343.99 306277.44 303684.49 301091.55 301091.55 301091.55

CUMMULATIVE NET CASH FLOW 1008010.06 1314287.50 1617971.99 1919063.54 2220155.08 2521246.63

Net Present Value (at 18%) 114961.20 96148.16 80791.67 67882.92 57527.90 48752.45

Cumulative Net present Value 303877.68 400025.83 480817.50 548700.42 606228.31 654980.77

Net Present Value (at 18%) 654,980.77

Internal Rate of Return 43.8%

6


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Annex 4: NET INCOME STATEMENT ( in Birr)

PRODUCTION

1 2 3 4 5

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

1. Total Income 1012500.00 1215000.00 1350000.00 1350000.00 1350000.00

Sales Revenue 1012500.00 1215000.00 1350000.00 1350000.00 1350000.00

Other Income 0.00 0.00 0.00 0.00 0.00

2. Less Variable Cost 657527.84 789033.41 876703.79 876703.79 876703.79

VARIABLE MARGIN 354972.16 425966.59 473296.21 473296.21 473296.21

(In % of Total Income) 35.06 35.06 35.06 35.06 35.06

3. Less Fixed Costs 76978.00 84494.80 89506.00 89506.00 89506.00

OPERATIONAL MARGIN 277994.16 341471.79 383790.21 383790.21 383790.21

(In % of Total Income) 27 28 28 28 28

4. Less Cost of Finance 111873.37 51858.94 43215.78 34572.63 25929.47

5. GROSS PROFIT 166120.79 289612.85 340574.43 349217.58 357860.74

6. Income (Corporate) Tax 0.00 0.00 102172.33 104765.28 107358.22

7. NET PROFIT 166120.79 289612.85 238402.10 244452.31 250502.52

RATIOS (%)

Gross Profit/Sales 16% 24% 25% 26% 27%

Net Profit After Tax/Sales 16% 24% 18% 18% 19%

Return on Investment 42% 49% 39% 39% 38%

Return on Equity 58% 101% 83% 85% 87%

7


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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 1350000.00 1350000.00 1350000.00 1350000.00 1350000.00

Sales Revenue 1350000.00 1350000.00 1350000.00 1350000.00 1350000.00

Other Income 0.00 0.00 0.00 0.00 0.00

2. Less Variable Cost 876703.79 876703.79 876703.79 876703.79 876703.79

VARIABLE MARGIN 473296.21 473296.21 473296.21 473296.21 473296.21


3. Less Fixed Costs 84594.00 84594.00 84594.00 84594.00 84594.00

OPERATIONAL MARGIN 388702.21 388702.21 388702.21 388702.21 388702.21


4. Less Cost of Finance 17286.31 8643.16 0.00 0.00 0.00

5. GROSS PROFIT 371415.90 380059.05 388702.21 388702.21 388702.21

6. Income (Corporate) Tax 111424.77 114017.72 116610.66 116610.66 116610.66

7. NET PROFIT 259991.13 266041.34 272091.55 272091.55 272091.55

RATIOS (%)

Gross Profit/Sales 28% 28% 29% 29% 29%

Net Profit After Tax/Sales 19% 20% 20% 20% 20%

Return on Investment 38% 38% 38% 38% 38%

Return on Equity 90% 92% 94% 94% 94%

8


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Annex 5: Projected Balance Sheet (in Birr)


Year 1 Year 2 1 2 3 4

TOTAL ASSETS 257880.00 720263.02 996838.36 1236515.82 1417618.89 1590044.90

1. Total Current Assets 0.00 204503.02 514990.36 788579.82 1003594.89 1209932.90

Inventory on Materials and Supplies 0.00 0.00 74642.46 89570.96 99523.29 99523.29

Work in Progress 0.00 0.00 19556.16 23467.39 26074.88 26074.88

Finished Products in Stock 0.00 0.00 39112.32 46934.79 52149.76 52149.76

Accounts Receivable 0.00 0.00 110454.55 132545.45 147272.73 147272.73

Cash in Hand 0.00 0.00 20066.32 24079.58 26755.09 26755.09

Cash Surplus, Finance Available 0.00 204503.02 251158.55 471981.64 651819.14 858157.15

Securities 0.00 0.00 0.00 0.00 0.00 0.00

2. Total Fixed Assets, Net of Depreciation 257880.00 515760.00 481848.00 447936.00 414024.00 380112.00

Fixed Investment 0.00 245600.00 491200.00 491200.00 491200.00 491200.00

Construction in Progress 245600.00 245600.00 0.00 0.00 0.00 0.00

Pre-Production Expenditure 12280.00 24560.00 24560.00 24560.00 24560.00 24560.00

Less Accumulated Depreciation 0.00 0.00 33912.00 67824.00 101736.00 135648.00

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 257880.00 720263.02 996838.36 1236515.82 1417618.89 1590044.90

5. Total Current Liabilities 0.00 0.00 110454.55 132545.45 147272.73 147272.73


Bank Overdraft 0.00 0.00 0.00 0.00 0.00 0.00

6. Total Long-term Debt 154728.00 432157.81 432157.81 360131.51 288105.21 216078.91

Loan A 154728.00 432157.81 432157.81 360131.51 288105.21 216078.91Loan B 0.00 0.00 0.00 0.00 0.00 0.00

7. Total Equity Capital 103152.00 288105.21 288105.21 288105.21 288105.21 288105.21

Ordinary Capital 103152.00 288105.21 288105.21 288105.21 288105.21 288105.21

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 Brought Forward 0.00 0.00 0.00 166120.79 455733.64 694135.74

9. Net Profit After Tax 0.00 0.00 166120.79 289612.85 238402.10 244452.31

Dividends Payable 0.00 0.00 0.00 0.00 0.00 0.00

Retained Profits 0.00 0.00 166120.79 289612.85 238402.10 244452.31

9


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

PRODUCTION

5 6 7 8 9 10

TOTAL ASSETS 1768521.11 1956485.94 2150500.97 2422592.52 2694684.07 2966775.61

1. Total Current Assets 1422321.11 1639285.94 1862300.97 2163392.52 2464484.07 2765575.61

Inventory on Materials and Supplies 99523.29 99523.29 99523.29 99523.29 99523.29 99523.29

Work in Progress 26074.88 26074.88 26074.88 26074.88 26074.88 26074.88

Finished Products in Stock 52149.76 52149.76 52149.76 52149.76 52149.76 52149.76

Accounts Receivable 147272.73 147272.73 147272.73 147272.73 147272.73 147272.73

Cash in Hand 26755.09 26755.09 26755.09 26755.09 26755.09 26755.09

Cash Surplus, Finance Available 1070545.36 1287510.19 1510525.22 1811616.77 2112708.32 2413799.86

Securities 0.00 0.00 0.00 0.00 0.00 0.00

2. Total Fixed Assets, Net of Depreciation 346200.00 317200.00 288200.00 259200.00 230200.00 201200.00

Fixed Investment 491200.00 491200.00 491200.00 491200.00 491200.00 491200.00Construction in Progress 0.00 0.00 0.00 0.00 0.00 0.00

Pre-Production Expenditure 24560.00 24560.00 24560.00 24560.00 24560.00 24560.00

Less Accumulated Depreciation 169560.00 198560.00 227560.00 256560.00 285560.00 314560.00

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 1768521.11 1956485.94 2150500.97 2422592.52 2694684.07 2966775.61

5. Total Current Liabilities 147272.73 147272.73 147272.73 147272.73 147272.73 147272.73


Bank Overdraft 0.00 0.00 0.00 0.00 0.00 0.00

6. Total Long-term Debt 144052.60 72026.30 0.00 0.00 0.00 0.00

Loan A144052.60 72026.30 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 288105.21 288105.21 288105.21 288105.21 288105.21 288105.21

Ordinary Capital 288105.21 288105.21 288105.21 288105.21 288105.21 288105.21

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 Brought Forward 938588.05 1189090.57 1449081.70 1715123.04 1987214.58 2259306.13

9. Net Profit After Tax 250502.52 259991.13 266041.34 272091.55 272091.55 272091.55

Dividends Payable 0.00 0.00 0.00 0.00 0.00 0.00

Retained Profits 250502.52 259991.13 266041.34 272091.55 272091.55 272091.55

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wood poles

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