Duration: 2 days

Designed to appeal to project sponsors, bankers and advisors, Best Practice Project Finance Modelling is essential to improve your ability to build, review or analyse project finance models at all levels.

Best Practice Project Finance Modelling will give you the tools you need to build and sensitise robust and transparent cashflow based financial models and dramatically increase your Excel efficiency. During this two day financial modelling course you will, under personal coaching from our expert trainer, build your own project finance model from scratch using SMART, Corality’s globally proven modelling methodology.

You will learn the modelling principles and structured approach that are applicable across a range of industries including Mining, Oil & Gas, Power, Renewable Energy, Real Estate and Infrastructure.

This course will enable you to

• Achieve consistent and accurate outputs using SMART best practice modelling
• Learn efficient modelling techniques to deliver more analysis, faster and more accurately
• Master time saving techniques including scenario management and data tables
• Construct flexible debt repayment functionality and ratio analysis
• Learn from professional financial modellers and leading developments in transaction modelling

Who should attend this course?

This course is suitable for anyone who needs to build, review or analyse project finance models. Typical attendees include Analysts, Managers, Senior Managers and Associate Directors.

Course outline

Day one

Master proven techniques for best practice modelling resulting in better models built faster

• Learn to work with the powerful and easy to follow SMART best practice modelling methodology
• Discuss and identify good vs. bad modelling techniques using real-life examples
• Greatly increase consistency amongst your team in calculation technique and presentation

Discuss the life-cycle of a project finance model, from screening and structuring to financial close

• Learn the various structural phases of project finance. Understand when to use which phase
• Build your understanding of the building block components, key details and challenges of a transaction model
• Understand the design flow of the model builder, learn how to know where to go next

Develop a model structure that is robust and scalable that can evolve with a typical project or transaction

• Establish key constants in the model using full scope of Excel range name function
• Build a flexible timing structure using appropriate date functions and binary flags
• Construct modularised units that form the building blocks of a professional model including (but not limited to):

  -    Capital Expenditure breakdown with contingencies controls
  -    Production calculations with multi-path optionality on time-series schedules
  -    Revenue build up with detailed pricing controls
  -    Operational and maintenance expenses including fixed and variable items

Understand the structure of cashflow waterfalls and the importance of ‘seniority’

• Focus on how to calculate Cash Flow Available for Debt Service
• Learn how to layout line items in an efficient and easy to communicate way
• Understand the different types of circular references and how to avoid them

Day two

Integrate project finance term (operational) debt

• Walk through of term debt structuring and annuity repayment through first principles
• Inclusion of target Debt Service Coverage Ratio repayment functionality
• Discussion of linear and bullet repayment structures in project finance

Construct and analyse debt facilities for credit or investment decisions

• Learn the importance of credit ratios and their purposes in analysis
• Build commonly used ratios in banking and finance from first principles
• Extract key metrics from ratios using a range of advanced Excel functions

Calculate key returns results and understand the role of dividends policy

• Discuss the reason and impact of dividends policy on valuations
• Integrate internal rate of returns and NPV, understand role of the discount rate
• Learn differences between NPV and XNPV functions and common errors in their application

Take control of robust and rapid sensitivity and scenario analysis through powerful Excel techniques

• Save time and deliver rapid analysis with our approach to scenario management
• Use the scenario manager to test the model in all scenarios
• Build confidence in your analysis through pre-programmed combinations of model inputs

Pre-course knowledge

While no pre-course modelling knowledge is strictly required, it is expected that participants have a good handle on Excel prior to attending the course. Upon registration you are entitled to our introductory material on Excel functions which will give you the confidence and skills to fully absorb the contents of this course.

n  Focus on how to calculate Cash Flow Available for Debt Service

n  Learn how to layout line items in an efficient and easy to communicate way

n  Understand the different types of circular references and how to avoid them