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Business Case Example 1.1

The document presents a business case for a fiber-to-the-home (FTTH) project in DQ Faifa, Riyadh, Saudi Arabia. It analyzes the project's key metrics over a 10-year period from 2020 to 2030. The project involves deploying FTTH to 1,293 residential units and is expected to generate over SAR 13.9 million in total revenue with an EBITDA of SAR 12.4 million and a positive net present value of SAR 4.6 million. The number of subscribers is projected to grow steadily from 453 in the first year to a cumulative total of 427 by the end of the period. Total capital expenditures of SAR 3 million are expected in the

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Sergei Moshenkov
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116 views15 pages

Business Case Example 1.1

The document presents a business case for a fiber-to-the-home (FTTH) project in DQ Faifa, Riyadh, Saudi Arabia. It analyzes the project's key metrics over a 10-year period from 2020 to 2030. The project involves deploying FTTH to 1,293 residential units and is expected to generate over SAR 13.9 million in total revenue with an EBITDA of SAR 12.4 million and a positive net present value of SAR 4.6 million. The number of subscribers is projected to grow steadily from 453 in the first year to a cumulative total of 427 by the end of the period. Total capital expenditures of SAR 3 million are expected in the

Uploaded by

Sergei Moshenkov
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Residential Compound Number of units

Expected Revenue OpEx CapEx


FTTH Business Case - DQ Faifa 1,293 13,990,644 866,714 3,008,000

https://www.google.com/maps/place/Al+Raed,+Riyadh/@24.7074202,46.6211439,14z/data=!3m1!4b1!4m5!3m4!1s0x3e2f1d
EBITDA NPV
12,412,780 SAR 4,572,149

1!4b1!4m5!3m4!1s0x3e2f1d0e82ddde65:0xe5a4489ce472ee6c!8m2!3d24.7092093!4d46.6386728
DQ Faifa Hay Business Case

Total Units 1,293

0 1
2020 2021

Compounds Deployment HH 1,293


Deployment Total 1,293 -

Compounds Deployment (HH) cumulative 1,293 1,293


Total Deployment cumulative 1,293 1,293

Uptake
Yearly uptake Subs 35% 37%

Sold Lines & Subs 2020 2021


New Sales 453 26
Total Subs 453 433
Churn 10% 8%
CBU Subscribers (Net Ads) Cumulative 407 399
Churn-N 45 35

0 1
ARPU 2020 2021

FTTH Blended ARPU (Monthly) 265 265

Revenue 2020 2021


Months 7 12
Fine-For-Churn Revenue 27,153 20,791
Subscriber Revenues 755,532 1,267,238
Total 782,685 1,288,030

Commission & CPE 2020 2021


Sales commission per new line 650 650
CPE 350 350

Total Commission 294,158 16,809

Total CPE Cos 158,393 9,051

Total O&M Opex 342,467 45,704

Total Cost 795,017 71,564

Total Capex 3,008,000


Total Opex

WACC 10%
0 1
2020 2021
CF -3,020,332 1,216,465

DCF -3,020,332 1,105,878

NPV SAR 4,572,149


EBITDA -12,332 1,216,465

EBITDA % -2% 94%


2 3 4 5 6
2022 2023 2024 2025 2026

- -

1,293 1,293 1,293 1,293 1,293


1,293 1,293 1,293 1,293 1,293

39% 41% 43% 45% 47%

2022 2023 2024 2025 2026


26 26 26 26 26
424 425 425 430 434
6% 6% 5% 5% 5%
399 399 404 408 412
25 25 21 21 22

2 3 4 5 6
2022 2023 2024 2025 2026

265 265 265 265 265

2022 2023 2024 2025 2026


12 12 12 12 12
15,277 15,291 12,754 12,892 13,023
1,268,505 1,269,695 1,284,333 1,298,240 1,311,451
1,283,782 1,284,987 1,297,087 1,311,132 1,324,474

2022 2023 2024 2025 2026


650 650 650 650 650
350 350 350 350 350

16,809 16,809 16,809 16,809 16,809

9,051 9,051 9,051 9,051 9,051

47,198 48,691 50,185 51,678 53,171

73,058 74,551 76,045 77,538 79,031

2 3 4 5 6
2022 2023 2024 2025 2026
1,210,724 1,210,435 1,221,043 1,233,594 1,245,443

1,000,598 909,418 833,989 765,965 703,020

1,210,724 1,210,435 1,221,043 1,233,594 1,245,443

94% 94% 94% 94% 94%


7 8 9 10
2027 2028 2029 2030

1,293 1,293 1,293 1,293


1,293 1,293 1,293 1,293

49% 51% 53% 55%

2027 2028 2029 2030


26 26 26 26 Average
438 442 446 450 436
5% 5% 5% 5%
416 420 424 427
22 22 22 22

7 8 9 10
2027 2028 2029 2030

265 265 265 265

2027 2028 2029 2030


12 12 12 12 Total
13,148 13,266 13,379 13,486 170,461
1,324,001 1,335,924 1,347,251 1,358,012 13,820,183
1,337,149 1,349,191 1,360,630 1,371,497 13,990,644

2027 2028 2029 2030


650 650 650 650
350 350 350 350

16,809 16,809 16,809 16,809

9,051 9,051 9,051 9,051

54,665 56,158 57,652 59,145 866,714


80,525 82,018 83,512 85,005 1,577,864

7 8 9 10
2027 2028 2029 2030
1,256,625 1,267,173 1,277,118 1,286,492 11,111,111

644,847 591,145 541,623 495,999

1,256,625 1,267,173 1,277,118 1,286,492 12,412,780


94% 94% 94% 94% 89%
EXECUTIVE SUMMARY

New Sales - Churn = Cumulative CBU Subscribers

500
420 424 427
453 412 416
407 404 408
399 399 399
450

400

350

300

250

200

150

100
45
35
25 25 21 21 22 22 22 22 22
50 26 26 26 26 26 26 26 26 26 26
Chu
0 New Sa
2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

New Sales Churn-N CBU Subscribers (Net Ads) Cumulative

Cost Structure

4,000,000

3,500,000

3,000,000

2,500,000

2,000,000
3,500,000

3,000,000

2,500,000

2,000,000

1,500,000

1,000,000

500,000

0
2020 2021 2022 2023 2024 2025 2026 2027 202

Total Commission Total CPE Cos Total O&M Opex Total Capex
e CBU Subscribers Total Revenue

4,000,000

420 424 427


3,500,000

3,000,000

2,500,000

2,000,000

1,500,000

1,000,000

500,000

22 22 22
26 26 0
CBU Subscribers (Net Ads) Cumulative 2020 2021 2022 2023 20
Churn-N
New Sales
8 2029 2030

(Net Ads) Cumulative Fine-For-Churn Revenu

e NPV An
NPV
2026 2027 2028 2029 2030

&M Opex Total Capex


Total Revenue Components

21 2022 2023 2024 2025 2026 2027 2028 2029 2030

Fine-For-Churn Revenue Subscriber Revenues

NPV A nalys is
NPV DCF CF
Assumptions

265 Blended ARPU/Month


0% Blended ARPU Inflation
600 Fine for Churn

650 Sales Commissions


0% Sales Commissions Inflation
350 CPE
0% CPE Inflation

10% WACC

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