Agriculture Private Equity Case Study Question

I recently interviewed for a job in a private equity firm that focuses mostly on agriculture and farmland, they assigned a case study as part of the interview process. The case study is fairly simple compared to most of the ones I've seen on here, all they asked me to do is to project an Income Statement and Cash Flow statement going forward 10 years for a one product farm and small powerpoint presentation explaining my findings.

The only problem I'm running into is that they told me not to build a balance sheet and not to include depreciation, interest, purchase of PPE, sale of PPE or any financing on my model. The way I see it this pretty much leaves my cash flow statement as Net Income every year because I'm also not supposed to forecast A/R, A/P or prepaid expenses. Is there something I'm missing or is this essentially it?

If any of you have any experience in agriculture Private equity would you mind if I PM and ask a few specific questions?

Private Equity Interview Course

  • 2,447 questions - 203 PE funds. Crowdsourced from 750k+ members
  • 9 Detailed LBO Modeling Tests and 15+ hours of video solutions.
  • Trusted by over 1,000 aspiring private equity professionals just like you.

Comments (2)

Nov 27, 2019 - 2:54am

To me it sounds like they want you to focus on the operations of a farm. Think about cycicality of commodities (can be very volatile) and other inputs like fertilizer, energy (linked to fertilizer), seeds, crop protection and especially the yield per square feet and how that can be influenced by those other inputs. Use more fertilizer -> higher output, but there is an optimum or sometimes a legislative maximum.

Tricky case :)

Start Discussion

Total Avg Compensation

May 2021 Private Equity

  • Principal (7) $694
  • Director/MD (17) $582
  • Vice President (64) $370
  • 3rd+ Year Associate (66) $267
  • 2nd Year Associate (129) $251
  • 1st Year Associate (273) $223
  • 3rd+ Year Analyst (24) $164
  • 2nd Year Analyst (60) $136
  • 1st Year Analyst (173) $119
  • Intern/Summer Associate (19) $70
  • Intern/Summer Analyst (199) $59