Hi everyone
I've just had a couple of interviews for a Metals & Mining gig and was given a case study to complete over the weekend. FYI, I'm a second year analyst in M&A and can do DCF/LBO modelling pretty comfortably. The details of the case study is below (there were no attachments or further guidance):
Case study: analyse the debt sizing capacity of the Bengalla coal mine (based in Aus)
Deliverables: − 3 page powerpoint presentation 1. Asset overview (key stats and important points with respect to debt sizing) 2. Asset financials 3. Term sheet (key points looking for are structure of the debt, size of debt, sizing approach and appropriate covenants) − Simple dynamic excel asset model which can perform debt sizing and display key debt metrics
My question is around the modelling:
- Where would I get historical revenue / cash flow figures for a specific coal mine to project future financials? The company that owns this mine (Newhope Group) doesn't disclose financials for this asset...
- I haven't done a debt sizing model before. I'm guessing first I need to come up with some reasonable leverage metrics to use as parameters to size the debt? If someone could provide me with a high level framework for sizing debt, that would be great (i.e. appropriate metrics to use as parameters). I think the starting point would be to look at other mining companies and see what their leverage levels are?
Any other tips would be greatly appreciated! I felt like I was getting close to the end... and a super vague case study comes up... Not ideal!
Thanks
K
