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PROJECTED FINANCIALS & FEASIBILITY

The projected finanancials and feasibility of our project is given below in the form of financial statements.

The total investment required is 91100000 in Pakistani currency. The capital structure of this required

investment is given below. 40% equity will be provided by the two partners who own this facility while the rest

of 60% funds will be acquired from a reputable bank in the form of loan at an interest rate of 15%.

CAPITAL STRUCTURE

Equity (40%) 36,440,000.0 Debt (60%) 54,660,000.0

Further in our financial statements the expenses will be having and annual increase of 5% while the income

and revenues are projected to have an annual increase of 10%. The rest of the financial projections and

feasibility of the project has been made clear through the help of the constructed financial statements which

are given below.

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OPERATING EXPENSES Year 1 Year 2 Year 3 Year 4 Year 5 Administrative Salaries 3,100,000 3,255,000 3,417,750 3,588,638 3,768,069 legal fees 50,000 52,500 55,125 57,881 60,775 Entertainment 240,000 252,000 264,600 277,830 291,722 Telephone, Fax and Postage 60,000 63,000 66,150 69,458 72,930 Electricity +Generator 3,000,000 3,150,000 3,307,500 3,472,875 3,646,519 Advertisement 1,000,000 1,050,000 1,102,500 1,157,625 1,215,506 Repair of equip 50,000 52,500 55,125 57,881 60,775 Traveling conveyance 20,000 21,000 22,050 23,153 24,310 Printing and stationery 15,000 15,750 16,538 17,364 18,233

Total Operating Expenses 7,535,000 7,911,750 8,307,338 8,722,704 9,158,840

Year 1 Year 2 Year 3 Year 4 Year 50

1,000,0002,000,0003,000,0004,000,0005,000,0006,000,0007,000,0008,000,0009,000,000

10,000,000

Total Operating Expenses

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REVENUES

Monthly Membership

YearRegistration Reg Revenue

Monthly Members Avg Monthly Rev Yearly revenue

Year 1 4000 4,000,000 3000 1000 3,000,000 36,000,000

Year 2 4400 440,000 3000 1100 3,300,000 39,600,000

Year 3 4840 532,400 3000 1210 3,630,000 43,560,000

Year 4 5324 644,204 3000 1331 3,993,000 47,916,000

Year 5 5856 778,901 3000 1464 4,392,300 52,707,600

Permanent membership

Year Package 50 % off Members Perm Revenue

Year 1 1,000,000 800,000 400 320,000,000

Year 2 1,000,000 800,000 440 352,000,000

Year 3 1,000,000 800,000 484 387,200,000

Year 4 1,000,000 800,000 532 425,920,000

Year 5 1,000,000 800,000 586 468,512,000

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Café Revenue

Year Tobocco Yearly Dunkin Donuts Yearly Café Revenue

Year 1 25000 300000 25000 300000 600,000

Year 2 27500 330000 27500 330000 660,000

Year 3 30250 363000 30250 363000 726,000

Year 4 33275 399300 33275 399300 798,600

Year 5 36602.5 439230 36602.5 439230 878,460

Rooftop Functions

Year Functions Revenue per Function Total Revenue

Year 1 100 50,000 5,000,000

Year 2 110 55,000 5,500,000

Year 3 121 60,500 6,050,000

Year 4 133 66,550 6,655,000

Year 5 146 73,205 7,320,500

Day Care Revenue Year Per Child Day care Daycare revenue

Year 1 2,000 300 600,000

Year 2 2,000 330 660,000

Year 3 2,000 363 726,000

Year 4 2,000 399 798,600

Year 5 2,000 439 878,460

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INCREMENTAL CASH FLOWS

Years 2010 2011 2012 2013 2014 2015

Initial Investment Outlay Land (62,000,000) Building & Construction (25,000,000) Furniture & Equipment Cost (1,500,000) Net working capital (2,000,000) Legal Fees (500,000) Game Room (100,000)

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Total Initial Investment (91,100,000)

Incremental Operating Cash Flows Revenue 366,200,000 398,860,000 438,794,400 482,732,404 531,075,921 Operating expenses (7,535,000) (7,911,750) (8,307,338) (8,722,704) (9,158,840)Depreciation (1,325,000) (1,325,000) (1,325,000) (1,325,000) (1,325,000)Earning Before Interest &Taxes 357,340,000 389,623,250 429,162,063 472,684,700 520,592,082 Interest(15%) (8,128,515) (8,128,515) (8,128,515) (8,128,515) (8,128,515)Earning Before Taxes 349,211,485 381,494,735 421,033,548 464,556,185 512,463,567 Taxes(35%) (122,224,020) (133,523,157) (147,361,742) (162,594,665) (179,362,248)Net Income 226,987,465 247,971,578 273,671,806 301,961,520 333,101,318 Add Back Depreciation 1,325,000 1,325,000 1,325,000 1,325,000 1,325,000 Net Operating Cash Flows 228,312,465 249,296,578 274,996,806 303,286,520 334,426,318

Terminal Cash Flows Net working capital 2,000,000 Total Terminal Cash Flow 2,000,000

Annual Cash Flows (91,100,000) 228,312,465 249,296,578 274,996,806 303,286,520 336,426,318

____________________________________________________________________University of Central Punjab

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Year 1 Year 2 Year 3 Year 4 Year 50

50,000,000

100,000,000

150,000,000

200,000,000

250,000,000

300,000,000

350,000,000

400,000,000

Net Operating Cash Flows

2010 2011 2012 2013 2014 2015

-200,000,000

-100,000,000

0

100,000,000

200,000,000

300,000,000

400,000,000

Annual Cash Flows

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PROJECT ECONOMICS

Net Present Value

NPV 638,740,731

Internal Rate of Return

IRR 135.00%

The Payback Period

PBP 0.46

Opportunity Cost

Discount Rate 15%

All the project economics indicate that in this scenario the project should be undertaken without any

hesitation as it shows a payback period of only 4 months which is quite exceptional and an IRR of 135% which

also indicates massive return on investment.

____________________________________________________________________University of Central Punjab