Biodigester

Financial Projections Base Case

Statement of Income and Retained Earnings

For the year ended March 31 2006 2007 2008 2009 2010 2011 2012 2013 2014

Sales Revenue:
Energy 165,100 168,402 171,770 175,206 178,710 182,284 185,930 189,648 193,441
Fertilizer 146,300 149,226 152,211 155,255 158,360 161,527 164,758 168,053 171,414
Manure Handling 56,000 64,260 65,545 66,856 68,193 69,557 70,948 72,367 73,815
Total 367,400 381,888 389,526 397,316 405,263 413,368 421,635 430,068 438,669

Cost of Goods Sold 147,543 316,089 264,700 223,756 191,224 165,392 144,978 128,866 116,255
Gross Margin 219,857 65,799 124,826 173,561 214,038 247,976 276,657 301,202 322,415

Operating and Marketing Expenses

Start-up Training 640 - - - - - - - -
Marketing 17,026 15,031 15,260 15,508 15,777 16,070 16,387 16,733 17,110
Interest on Long Term Debt 62,495 57,972 53,132 47,953 42,412 36,483 30,139 23,351 16,087
Total Expenses 80,161 73,003 68,392 63,461 58,189 52,553 46,526 40,084 33,197

Income Before Taxes 139,696 (7,204) 56,434 110,099 155,849 195,423 230,131 261,118 289,217
Income Taxes 15,143 - 5,337 11,935 16,894 21,184 24,946 28,305 31,351
Net Income(Loss) 124,553 (7,204) 51,097 98,165 138,955 174,239 205,185 232,813 257,866

Beg Retained Earnings - 124,553 17,275 (118,602) (208,333) (257,060) (271,974) (258,209) (219,656)
Net Income(Loss) 124,553 (7,204) 51,097 98,165 138,955 174,239 205,185 232,813 257,866
Dividends - 100,075 186,974 187,896 187,682 189,153 191,420 194,260 197,630
End Retained Earnings 124,553 17,275 (118,602) (208,333) (257,060) (271,974) (258,209) (219,656) (159,420)

Dividend Policy (219,364) 100,075 186,974 187,896 187,682 189,153 191,420 194,260 197,630

Page 1
Balance Sheet
March 31 2006 2007 2008 2009 2010 2011 2012 2013 2014

Assets
Current Assets:
Cash 323,805 415,138 420,581 424,958 431,112 438,135 445,826 454,123 462,876
Accounts Receivable - - - - - - - - -
Total Inventories 48,767 49,742 50,737 51,752 52,787 53,842 54,919 56,018 57,138
Total Current Assets 372,572 464,880 471,317 476,710 483,899 491,978 500,745 510,141 520,014

Capital Assets:
Plant and Equipment 1,626,694 1,626,694 1,626,694 1,626,694 1,626,694 1,626,694 1,626,694 1,626,694 1,626,694
Accumulated C.C.A. (148,869) (417,494) (633,681) (807,853) (948,353) (1,061,856) (1,153,706) (1,228,182) (1,288,710)
Net Plant and Equipment 1,477,825 1,209,200 993,013 818,841 678,341 564,838 472,988 398,512 337,984

Total Assets 1,850,396 1,674,079 1,464,330 1,295,551 1,162,240 1,056,816 973,733 908,653 857,999

Liabilities
Current Liabilities:
Accounts Payable 4,894 4,996 5,104 5,215 5,331 5,450 5,576 5,704 5,839

Noncurrent Liabilities
Long Term Debt 828,166 759,025 685,045 605,886 521,185 430,556 333,583 229,821 118,797
Total Liabilities 833,060 764,021 690,149 611,100 526,517 436,007 339,159 235,526 124,636

Shareholders' Equity
Owner's Equity 892,783 892,783 892,783 892,783 892,783 892,783 892,783 892,783 892,783
Retained Earnings 124,553 17,275 (118,602) (208,333) (257,060) (271,974) (258,209) (219,656) (159,420)
Total Shareholder's Equity 1,017,336 910,058 774,181 684,450 635,723 620,809 634,574 673,127 733,363

Total Liabilities and 1,850,396 1,674,079 1,464,330 1,295,551 1,162,240 1,056,816 973,733 908,653 857,999
Shareholder's Equity

Page 2
Statement of Cash Flow
For the year ended March 31 2006 2007 2008 2009 2010 2011 2012 2013 2014

Cash from (used in) Operating Activities:

Net Income(Loss) 124,553 (7,204) 51,097 98,165 138,955 174,239 205,185 232,813 257,866
Depreciation 148,869 268,625 216,187 174,172 140,499 113,503 91,851 74,476 60,527
Accounts Receivable - - - - - - - - -
Inventory (48,767) (975) (995) (1,015) (1,035) (1,056) (1,077) (1,098) (1,120)
Accounts Payable 4,894 102 108 110 117 119 126 128 135
Net Cash Flow from Operations 229,550 260,548 266,398 271,433 278,536 286,805 296,084 306,319 317,408

Cash from (used for) Financing Activities:

Owner's Equity 892,783 - - - - - - - -

Long Term Debt 828,166 (69,141) (73,980) (79,159) (84,700) (90,629) (96,973) (103,761) (111,025)
Dividends - (100,075) (186,974) (187,896) (187,682) (189,153) (191,420) (194,260) (197,630)
Net Cash Flow from Financing 1,720,949 (169,215) (260,955) (267,055) (272,382) (279,782) (288,394) (298,021) (308,655)

Cash from (used for) Investing Activities:

Buildings and Equipment (1,626,694) - - - - - - - -

Net Cash Flow from Investing (1,626,694) - - - - - - - -

Increase(decrease) in Cash 323,805 91,333 5,443 4,378 6,154 7,023 7,691 8,297 8,753

Cash beginning of year - 323,805 415,138 420,581 424,958 431,112 438,135 445,826 454,123
Cash end of year 323,805 415,138 420,581 424,958 431,112 438,135 445,826 454,123 462,876

Page 3
Supporting Schedules

Schedule 1: Economic Forecast

2006 2007 2008 2009 2010 2011 2012 2013 2014
Long Term Debt Rate Input 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0%
Rate of Inflation (expenses) Input 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%

Schedule 2: Revenues
2006 2007 2008 2009 2010 2011 2012 2013 2014
Growth in Selling Prices
Electricity Input 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%
Fertilizer Input 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%
Manure Handling Input 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%

Quantity of Sales
Electricity (kWh) Input 1,500,910 1,500,910 1,500,910 1,500,910 1,500,910 1,500,910 1,500,910 1,500,910 1,500,910
Fertilizer (m³) Input 26,600 26,600 26,600 26,600 26,600 26,600 26,600 26,600 26,600
Manure Handling (m³) Input 28,000 31,500 31,500 31,500 31,500 31,500 31,500 31,500 31,500
Total Quantity 1,555,510 1,559,010 1,559,010 1,559,010 1,559,010 1,559,010 1,559,010 1,559,010 1,559,010

2006 2007 2008 2009 2010 2011 2012 2013 2014

Selling Prices
Electricity (per kWh) Input 0.11 0.11 0.11 0.12 0.12 0.12 0.12 0.13 0.13
Fertilizer (per m³) Input 5.50 5.61 5.72 5.84 5.95 6.07 6.19 6.32 6.44
Manure Handling (per m³) Input 2.00 2.04 2.08 2.12 2.16 2.21 2.25 2.30 2.34
Average Selling Price 2.54 2.59 2.64 2.69 2.75 2.80 2.86 2.91 2.97

Sales Revenue
Electricity 165,100 168,402 171,770 175,206 178,710 182,284 185,930 189,648 193,441
Fertilizer 146,300 149,226 152,211 155,255 158,360 161,527 164,758 168,053 171,414
Manure Handling 56,000 64,260 65,545 66,856 68,193 69,557 70,948 72,367 73,815
Total 367,400 381,888 389,526 397,316 405,263 413,368 421,635 430,068 438,669

Page 4
Schedule 3: Cost of Goods Manufactured
2006 2007 2008 2009 2010 2011 2012 2013 2014
Salary Workers
Technician Input 18,000 18,360 18,727 19,102 19,484 19,873 20,271 20,676 21,090

Total Direct Labour 18,000 18,360 18,727 19,102 19,484 19,873 20,271 20,676 21,090

Page 5
Benefits for Salary Employees
Employment Insurance 3.08% 554 565 577 588 600 612 624 637 650
Canada Pension Plan 4.70% 846 863 880 898 916 934 953 972 991
Workers Compensation 3.00% 540 551 562 573 585 596 608 620 633
Total Benefits for Salary Employees 1,940 1,979 2,019 2,059 2,100 2,142 2,185 2,229 2,273

Total Direct Labour + Benefits 19,940 20,339 20,746 21,161 21,584 22,016 22,456 22,905 23,363

Variable Manufacturing Overhead Costs 2006 2007 2008 2009 2010 2011 2012 2013 2014

Maintenance Input 18,000 18,410 18,878 19,356 19,893 20,441 21,050 21,671 22,354
Total Variable Overhead 18,000 18,410 18,878 19,356 19,893 20,441 21,050 21,671 22,354

Fixed Manufacturing Overhead Costs

Natural Gas Input 6,000 6,120 6,242 6,367 6,495 6,624 6,757 6,892 7,030
Insurance Input 2,000 2,040 2,081 2,122 2,165 2,208 2,252 2,297 2,343
Property Taxes Input 500 510 520 531 541 552 563 574 586
Capital Cost Allowance 148,869 268,625 216,187 174,172 140,499 113,503 91,851 74,476 60,527
Electricity Input 1,000 1,020 1,040 1,061 1,082 1,104 1,126 1,149 1,172
Total Fixed Overhead 158,369 278,315 226,071 184,254 150,782 123,992 102,549 85,389 71,658

Total Manufacturing Overhead 176,369 296,725 244,949 203,609 170,675 144,432 123,599 107,059 94,012

Cost of Goods Manufactured 2006 2007 2008 2009 2010 2011 2012 2013 2014

Direct Labour Used 19,940 20,339 20,746 21,161 21,584 22,016 22,456 22,905 23,363
Manufacturing Overhead 176,369 296,725 244,949 203,609 170,675 144,432 123,599 107,059 94,012
Total Cost of Goods Manufactured 196,310 317,064 265,695 224,770 192,259 166,448 146,055 129,965 117,375

Page 6
Schedule 4: Cost of Goods Sold
2006 2007 2008 2009 2010 2011 2012 2013 2014
Beginning Inventory - 48,767 49,742 50,737 51,752 52,787 53,842 54,919 56,018
Cost of Goods Manufactured 196,310 317,064 265,695 224,770 192,259 166,448 146,055 129,965 117,375
Cost of Goods Available for Sale 196,310 365,831 315,437 275,507 244,011 219,235 199,897 184,884 173,393
Ending Inventory 48,767 49,742 50,737 51,752 52,787 53,842 54,919 56,018 57,138
Cost of Goods Sold 147,543 316,089 264,700 223,756 191,224 165,392 144,978 128,866 116,255

Schedule 5: Operating and Marketing Expenses

Marketing Salary and Wages

Staffing 2006 2007 2008 2009 2010 2011 2012 2013 2014
Manager Input 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0
Total Manager 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0

Total Annual Salaries

Manager Input 40,000 40,800 41,616 42,448 43,297 44,163 45,046 45,947 46,866
Total Salaries 40,000 40,800 41,616 42,448 43,297 44,163 45,046 45,947 46,866

Benefits for Manager/Technician

Employment Insurance 3.08% 1,232 1,257 1,282 1,307 1,334 1,360 1,387 1,415 1,443
Canada Pension Plan 4.70% 1,880 1,918 1,956 1,995 2,035 2,076 2,117 2,160 2,203
Workers Compensation 1.00% 400 408 416 424 433 442 450 459 469
Total Benefits for Salary Employees 3,512 3,582 3,654 3,727 3,802 3,878 3,955 4,034 4,115

Total Salaries and Benefits 43,512 44,382 45,270 46,175 47,099 48,041 49,002 49,982 50,981

Page 7
 2006 2007 2008 2009 2010 2011 2012 2013 2014
Marketing Expenses
Vehicle (Lease, Fuel & Ins) Input 10,776 10,776 10,776 10,776 10,776 10,776 10,776 10,776 10,776
Telephone Input 2,160 2,203 2,247 2,292 2,338 2,385 2,433 2,481 2,531
Brochures Input 1,590 1,752 1,931 2,128 2,345 2,584 2,848 3,138 3,458
Webpage Input 2,500 300 306 312 318 325 331 338 345
Total Marketing Expense 17,026 15,031 15,260 15,508 15,777 16,070 16,387 16,733 17,110

Summary of Operating and Marketing Expenses

Salaries and Benefits 43,512 44,382 45,270 46,175 47,099 48,041 49,002 49,982 50,981
Start-up Training Input 640 - - - - - - - -
Marketing Expenses 17,026 15,031 15,260 15,508 15,777 16,070 16,387 16,733 17,110
Interest on Long term Debt 62,495 57,972 53,132 47,953 42,412 36,483 30,139 23,351 16,087
Total Expenses 123,673 117,385 113,662 109,637 105,288 100,593 95,528 90,066 84,178

Page 8
Schedule 6: Capital Budget
2006 2007 2008 2009 2010 2011 2012 2013 2014

Land Input 2,000

Site Setup:
Building Input 62,000
Building Labour Input 72,000
Cement Input 12,000
Utilities hookup to grid Input 10,000
Site Preparation Input 20,000

Production Equipment:
Biodigester Package Input 1,059,194
4 Stainless steel tanks Input 222,000
2 Fertilizer storage tanks Input 53,000
1 Bio filter Input 12,000
2 Manure slurry tanks Input 25,000
4 Buffer tanks Input 30,000
4 Agitating systems Input 16,000
Water and Gas Piping Input 3,500
Manure & Fertilizer Piping Input 24,000

Office Equipment Input 4,000

Total Capital Costs 1,626,694 - - - - - - - -

Working Capital 2006 2007 2008 2009 2010 2011 2012 2013 2014
Accounts Receivable - - - - - - - - -
Inventory in progress - - - - - - - - -
Finished Inventory 48,767 49,742 50,737 51,752 52,787 53,842 54,919 56,018 57,138
Accounts Payable 4,894 4,996 5,104 5,215 5,331 5,450 5,576 5,704 5,839
Total 43,873 44,746 45,633 46,537 47,455 48,392 49,343 50,313 51,299

Average Days Inventory

Inventory in progress Input 0 0 0 0 0 0 0 0 0
Finished Inventory Input 8,867 8,867 8,867 8,867 8,867 8,867 8,867 8,867 8,867
Total Days Inventory 8,867 8,867 8,867 8,867 8,867 8,867 8,867 8,867 8,867

Average Days Payables Input 30 30 30 30 30 30 30 30 30

Page 9
Schedule 7: Financing Budget 2006 2007 2008 2009 2010 2011 2012 2013 2014

Long Term Debt Input 892,783 - - - - - - - -

Owner's Equity Input 892,783 - - - - - - - -
Total 1,785,567 - - - - - - - -

Schedule 8: Long Term Debt

Interest Rate 7.0% 2006 2007 2008 2009 2010 2011 2012 2013 2014
Payment Period (Years) 10
Beginning Balance - 828,166 759,025 685,045 605,886 521,185 430,556 333,583 229,821
Addition 892,783 - - - - - - - -
Interest 62,495 57,972 53,132 47,953 42,412 36,483 30,139 23,351 16,087
Debt Payment 127,112 127,112 127,112 127,112 127,112 127,112 127,112 127,112 127,112
Ending Balance 828,166 759,025 685,045 605,886 521,185 430,556 333,583 229,821 118,797

Schedule 9: Capital Cost Allowance

2006 2007 2008 2009 2010 2011 2012 2013 2014
Buildings Input Rate 5%
Beginning Balance - 171,600 163,020 154,869 147,126 139,769 132,781 126,142 119,835
Additions 176,000 - - - - - - - -
Capital Cost Allowance 4,400 8,580 8,151 7,743 7,356 6,988 6,639 6,307 5,992
Ending Balance 171,600 163,020 154,869 147,126 139,769 132,781 126,142 119,835 113,843

Equipment Input Rate 20%

Beginning Balance - 1,300,225 1,040,180 832,144 665,715 532,572 426,058 340,846 272,677
Additions 1,444,694 - - - - - - - -
Capital Cost Allowance 144,469 260,045 208,036 166,429 133,143 106,514 85,212 68,169 54,535
Ending Balance 1,300,225 1,040,180 832,144 665,715 532,572 426,058 340,846 272,677 218,141

Office Equipment Input Rate 100%

Beginning Balance - - - - - - - - -
Additions - - - - - - - - -
Capital Cost Allowance - - - - - - - - -
Ending Balance - - - - - - - - -

Total CCA Expense 148,869 268,625 216,187 174,172 140,499 113,503 91,851 74,476 60,527

Page 10
Schedule 10: Income Tax
2006 2007 2008 2009 2010 2011 2012 2013 2014
Income Before Taxes 139,696 (7,204) 56,434 110,099 155,849 195,423 230,131 261,118 289,217
Accumulated Loss Carryforward - (7,204) (7,204) - - - - - -
Loss Carryforward Used - - (7,204) - - - - - -
Taxable Income 139,696 - 49,230 110,099 155,849 195,423 230,131 261,118 289,217

Federal Tax @ 28%, 21% 29,336 - 10,338 23,121 32,728 41,039 48,328 54,835 60,736
Federal Surtax @ 4% 1,173 - 414 925 1,309 1,642 1,933 2,193 2,429
Small Bus Tax Credit @ 16% (22,351) - (7,877) (17,616) (24,936) (31,268) (36,821) (41,779) (46,275)
Provincial Tax @ 6%, 10% 6,985 - 2,462 5,505 7,792 9,771 11,507 13,056 14,461
Total Taxes 15,143 - 5,337 11,935 16,894 21,184 24,946 28,305 31,351

Schedule 11: Ratio Analysis 2006 2007 2008 2009 2010 2011 2012 2013 2014

Cash Conversion Cycle 8837 8837 8837 8837 8837 8837 8837 8837 8837

Liquidity Ratios
Current Ratio 76.13 93.05 92.34 91.42 90.76 90.26 89.80 89.43 89.05

Activity and Operating Ratios

Total Asset Turnover 0.20 0.23 0.27 0.31 0.35 0.39 0.43 0.47 0.51
Inventory Turnover 3.00 6.29 5.17 4.28 3.59 3.04 2.61 2.28 2.01
Average Days Inventory 122 58 71 85 102 120 140 160 181

Operating Expenses
Direct Labour/Sales 5.4% 5.3% 5.3% 5.3% 5.3% 5.3% 5.3% 5.3% 5.3%
Overhead/Sales 48.0% 77.7% 62.9% 51.2% 42.1% 34.9% 29.3% 24.9% 21.4%
Selling and Administration/Sales 33.7% 30.7% 29.2% 27.6% 26.0% 24.3% 22.7% 20.9% 19.2%
Total Expenses 87.1% 113.8% 97.4% 84.2% 73.4% 64.6% 57.3% 51.2% 45.9%

Leverage Ratios 2006 2007 2008 2009 2010 2011 2012 2013 2014
Debt Ratio 45.0% 45.6% 47.1% 47.2% 45.3% 41.3% 34.8% 25.9% 14.5%
Debt to Equity 81.9% 84.0% 89.1% 89.3% 82.8% 70.2% 53.4% 35.0% 17.0%

Profitability Ratios
Gross Profit Margin 59.8% 17.2% 32.0% 43.7% 52.8% 60.0% 65.6% 70.0% 73.5%
Net Profit Margin 33.9% -1.9% 13.1% 24.7% 34.3% 42.2% 48.7% 54.1% 58.8%
Return on Total Assets 6.7% -0.4% 3.5% 7.6% 12.0% 16.5% 21.1% 25.6% 30.1%
Return on Equity 12.2% -0.8% 6.6% 14.3% 21.9% 28.1% 32.3% 34.6% 35.2%
Net Profit Margin * 38.0% -1.9% 14.5% 27.7% 38.5% 47.3% 54.6% 60.7% 65.9%
Return on Total Assets * 6.7% -0.4% 3.5% 7.6% 12.0% 16.5% 21.1% 25.6% 30.1%
Return on Equity * 13.7% -0.8% 7.3% 16.1% 24.5% 31.5% 36.3% 38.8% 39.4%
* Using net income before tax

Page 11
Schedule 12: Investment Analysis 2006 2007 2008 2009 2010 2011 2012 2013 2014

Required Return on Equity Input 20%

Present Value of Equity Investment

Equity Investment 892,783 - - - - - - - -
Present Value of Equity Investment 892,783 - - - - - - - -

Present Value of Equity Returns

Net Cash Flows to Equity 323,805 91,333 5,443 4,378 6,154 7,023 7,691 8,297 8,753
Dividends - 100,075 186,974 187,896 187,682 189,153 191,420 194,260 197,630
Salvage Value - - - - - - - - -
Total Net Cash Flow to Equity 323,805 191,407 192,417 192,273 193,836 196,176 199,111 202,557 206,383

Present Value of Net Cash Flows 981,788

Total Cash Flows to Equity (892,783) 323,805 191,407 192,417 192,273 193,836 196,176 199,111 202,557 206,383

Net Present Value of Equity Investment 89,005

Internal Rate of Return on Equity Investment 22.9%

External Rate of Return on Equity Investment

Equity Investment (892,783)

Dividends - 100,075 186,974 187,896 187,682 189,153 191,420 194,260 197,630
Salvage Value - - - - - - - - -
Total to Equity Investor (892,783) - 100,075 186,974 187,896 187,682 189,153 191,420 194,260 197,630

External Rate of Return on Equity Investment 15.6%

Page 12
2015

197,310
174,842
75,291
447,443

106,413
341,030

-
17,520
8,316
25,836

315,194
36,598
278,596

(159,420)
278,596
201,358
(82,182)

201,358

Page 13
 2015

469,634
-
58,281
527,915

1,626,694
(1,338,030)
288,664

816,579

5,977

0
5,977

892,783
(82,182)
810,602

816,579

Page 14
2015

278,596
49,320
-
(1,143)
138
326,912

-
(118,797)
(201,358)
(320,154)

-
-

6,758

462,876
469,634

Page 15
2015
7.0%
2.0%

2015

2.0%
2.0%
2.0%

1,500,910
26,600
31,500
1,559,010

2015

0.13
6.57
2.39
3.03

197,310
174,842
75,291
447,443

Page 16
2015

21,512

21,512

Page 17
 663
1,011
645
2,319

23,831

2015

23,051
23,051

7,171
2,390
598
49,320
1,195
60,674

83,725

2015

23,831
83,725
107,555

Page 18
2015
57,138
107,555
164,693
58,281
106,413

2015
1.0
1.0

47,804
47,804

1,472
2,247
478
4,197

52,001

Page 19
2015

10,776
2,581
3,811
351
17,520

52,001
-
17,520
8,316
77,836

Page 20
2015

2015
-
-
58,281
5,977
52,304

0
8,867
8,867

30

Page 21
2015

-
-
-

2015

118,797
-
8,316
127,112
0

2015

113,843
-
5,692
108,151

218,141
-
43,628
174,513

-
-
-
-

49,320

Page 22
2015
315,194
-
-
315,194

66,191
2,648
(48,000)
15,760
36,598

2015

8837

88.33

0.55
1.83
200

5.3%
0.0%
17.4%
22.7%

2015
0.7%
0.7%

76.2%
62.3%
34.1%
34.4%
70.4%
34.1%
38.9%

Page 23
2015

-
-

6,758
201,358
340,968
549,083

549,083

201,358
810,602
1,011,959

Page 24
 Variable Costs

Cases Produced 1000 1000 2000 2000

Direct Material Purchases Unit Price Quanity/Case Price/Case Y1 Y2 Y3 Y4
Fruit Purchased (lb)
Rhubarb 1 9 9 $2,250.00 $2,250.00 $4,500.00 $4,500.00
Raspberries 3 9 27 $6,750.00 $6,750.00 $13,500.00 $13,500.00
Saskatoon berries 3 9 27 $6,750.00 $6,750.00 $13,500.00 $13,500.00
Chokecherries 1 9 9 $2,250.00 $2,250.00 $4,500.00 $4,500.00
Sugar (Kg) 0.8 1.44 1.152 $1,152.00 $1,152.00 $2,304.00 $2,304.00
Yeast (Package) 0.79 0.365 0.28835 $288.35 $288.35 $576.70 $576.70
Acid Blend (g) 0.0158 28.92 0.456936 $456.94 $456.94 $913.87 $913.87
Pectic Enzyme (g) 0.076 4.79 0.36404 $364.04 $364.04 $728.08 $728.08
Yeast Energizer (g) 0.0518 5.43 0.281274 $281.27 $281.27 $562.55 $562.55
Campden (tablet) 0.0518 2.13 0.110334 $110.33 $110.33 $220.67 $220.67
Clarifier (g) 0.076 3.38 0.25688 $256.88 $256.88 $513.76 $513.76
Water 0.02475 1 0.02475 $24.75 $24.75 $49.50 $49.50
Labels 0.25 12 3 $3,000.00 $3,000.00 $6,000.00 $6,000.00
Corks 0.295 12 3.54 $3,540.00 $3,540.00 $7,080.00 $7,080.00
Bottles 0.59 12 7.08 $7,080.00 $7,080.00 $14,160.00 $14,160.00
Shrink Wrap 0.1 12 1.2 $1,200.00 $1,200.00 $2,400.00 $2,400.00
Filters 0.405 1 0.405 $405.00 $405.00 $810.00 $810.00
Total $36,159.56 $36,159.56 $72,319.13 $72,319.13

Page 25
 Variable Costs

3000 3000 4000 4000 5000 5000

Y5 Y6 Y7 Y8 Y9 Y10

$6,750.00 $6,750.00 $9,000.00 $9,000.00 $11,250.00 $11,250.00

$20,250.00 $20,250.00 $27,000.00 $27,000.00 $33,750.00 $33,750.00
$20,250.00 $20,250.00 $27,000.00 $27,000.00 $33,750.00 $33,750.00
$6,750.00 $6,750.00 $9,000.00 $9,000.00 $11,250.00 $11,250.00
$3,456.00 $3,456.00 $4,608.00 $4,608.00 $5,760.00 $5,760.00
$865.05 $865.05 $1,153.40 $1,153.40 $1,441.75 $1,441.75
$1,370.81 $1,370.81 $1,827.74 $1,827.74 $2,284.68 $2,284.68
$1,092.12 $1,092.12 $1,456.16 $1,456.16 $1,820.20 $1,820.20
$843.82 $843.82 $1,125.10 $1,125.10 $1,406.37 $1,406.37
$331.00 $331.00 $441.34 $441.34 $551.67 $551.67
$770.64 $770.64 $1,027.52 $1,027.52 $1,284.40 $1,284.40
$74.25 $74.25 $99.00 $99.00 $123.75 $123.75
$9,000.00 $9,000.00 $12,000.00 $12,000.00 $15,000.00 $15,000.00
$10,620.00 $10,620.00 $14,160.00 $14,160.00 $17,700.00 $17,700.00
$21,240.00 $21,240.00 $28,320.00 $28,320.00 $35,400.00 $35,400.00
$3,600.00 $3,600.00 $4,800.00 $4,800.00 $6,000.00 $6,000.00
$1,215.00 $1,215.00 $1,620.00 $1,620.00 $2,025.00 $2,025.00
$108,478.69 $108,478.69 $144,638.26 $144,638.26 $180,797.82 $180,797.82

Page 26
 Estimated
Description Source
Cost ($)
Land 10,000
Site Setup:
Building 63,000 Goodon Industries
Sewage System 3,500 Wigs Pumps and Waterworks
Natural Gas Installation 8,000 Sask Energy
Electricity Installation 25,000 Sask Power
Town Water Installation 14,300 Balgonie
Landscaping 3,500 Lakeshore Garden Centre (S'toon)
Total Cost 127,300
Production Equipment: Capacity/Quantity/Source
Primary Fermenter 6,500 800 gal. - 1 - Dairyland Agro
Basket Press 1,000 110 Litre - 1 - The Compleat Winemaker
Filter 5,600 20 plates - Criveller Co. (Ont.)
Pump 1,000 20 gpm - 1 - The Compleat Winemaker
Storage Tanks 4,800 1000 Litre - 4 - Criveller Co. (Ont.)
Bottle Filler 800 4 nozzle - 1 - The Compleat Winemaker
Bottle Corker 50 Single corker - 1 - Wine Kitz
Hydrometer & Thermometer 500 1 - Fisher Scientific
pH meter and probe 600 1 - Coal Parmer (Montreal)
SO2 detector 500 1 - R & D Equipment (California)
Fruit Crusher 400 33" x 22" x 14" - The Compleat Winemaker
Walk in Freezer 14,000 1 - 9'x9' - D & C Refrigeration (Saskatoon)
Used Garden Tractor 5,000 20 hp mower and rototiller - Private Deal
Pallet Jack 429 2 ton capacity - 1 - Princess Auto
Irrigation 700 Drip - Rainmaker Irrigation (Outlook)
Office Equipment 3,000 Desk, Computer, Filing System
Total Equipment Costs 44,879
Total Working Capital 42,089
Total Capital Costs 214,268
 2004 2006 2008 2010 2012
Marketing/Sales Labour
Manager $20,000 $29,794 $31,302 $32,887 $34,552
Marketer $17,500 $38,407 $40,507 $43,595 $46,856
Benefits $3,293 $5,988 $6,305 $6,715 $7,148
Total Salaries $40,793 $74,188 $78,114 $83,197 $88,555
Seasonal Retail Students Wage (hour) $9.00 $9.46 $9.93 $10.44 $10.97
Hours 700 700 700 700 700
Benefits $919 $965 $1,014 $1,065 $1,119
Total
Total Season Wage Labour +
Marketing/Sales $7,219 $7,584 $7,968 $8,371 $8,795
Benefits $48,011 $81,772 $86,082 $91,568 $97,350

Production Labour
Permanent Labourer $15,000 $15,759 $16,557 $17,395 $18,276
Benefits for Salary Employees $1,617 $1,699 $1,785 $1,875 $1,970
Total Salaries $16,617 $17,458 $18,342 $19,271 $20,246
Part-Time Bottler Wage (hour) $8.00 $8.41 $8.83 $9.28 $9.75
Hours 225 450 675 900 1125
Benefits for Wage-Earning Employees $298 $627 $988 $1,384 $1,818
Total bottler wage $2,098 $4,409 $6,949 $9,734 $12,784
Total Direct Labour + Benefits $18,715 $21,868 $25,291 $29,005 $33,030
Direct Material Purchases
Fruit Purchased (lb)
Rhubarb 2,250
Raspberries 6,750
Saskatoon berries 6,750
Chokecherries 2,250
Sugar (Kg) 1,152
Yeast (Package) 288
Acid Blend (g) 457
Pectic Enzyme (g) 364
Yeast Energizer (g) 281
Campden (tablet) 110
Clarifier (g) 257
Water 25
Labels 3,000
Corks 3,540
Bottles 7,080
Shrink Wrap 1,200
Filters 405
Total Direct Materials 36,160

Direct Labour and Benefits

Permanent Labourer 15,000
Benefits for Salary Employees 1,617
Bottler wage 1,800
Benefits for bottlers 298
Total Direct Labour + Benef 18,715

Manufacturing Overhead Costs

Variable
Freight and Pallet Charges 360
Maintenance 300
Total Variable Overhead 660
Fixed
Natural Gas 1,250
Insurance 750
Property Taxes 1,000
Capital Cost Allowance 8,104
Electricity 1,440
Total Fixed Overhead 12,544
Total Manufacturing Overh 13,204

Cost of Goods Manufactured

Direct Materials 36,160
Direct Labour Used 18,715
Manufacturing Overhead 13,204
Total Cost of Goods Manufact 68,079
 Year
2004 2006 2008 2010 2012
Quantity of Sales (cases) 428 1856 2578 3623 4575
Sales Revenue
Saskatoon Berry Wine $14,583 $66,396 $96,902 $143,045 $189,781
Raspberry Wine $13,426 $61,131 $89,218 $131,702 $174,732
Chokecherry Wine $12,142 $55,281 $80,680 $119,099 $158,011
Rhubarb Wine $12,784 $58,206 $84,949 $125,401 $166,372
Total $52,935 $241,015 $351,749 $519,248 $688,896

Year 2004 2006 2008 2010 2012

Saskatoon Berry Wine $11.35 $11.92 $12.53 $13.16 $13.83
Raspberry Wine $10.45 $10.98 $11.53 $12.12 $12.73
Chokecherry Wine $9.45 $9.93 $10.43 $10.96 $11.51
Rhubarb Wine $9.95 $10.45 $10.98 $11.54 $12.12

2004 2006 2008 2010 2012

Sample Wine Costs $960 $1,220 $1,551 $1,972 $2,507
Mileage for deliveries (cost) $3,960 $8,321 $12,177
Vehicle (Lease) $14,000 $16,000
Telephone $250 $263 $276 $290 $305
Billboards $1,500 $1,576 $1,656 $1,740 $1,828
Radio Ads $4,000 $4,203 $4,415 $4,639 $4,874
Brochures $1,197 $1,455 $1,769 $2,150 $2,613
Newspaper ads $5,443 $5,719 $6,008 $6,312 $6,632
Bridal Shows $250 $263 $276 $290 $305
Trade Shows $500 $525 $552 $580 $609
Travelling backdrop $500 $103 $108 $113 $119
Webpage $325 $341 $359 $377 $396
Future Bus Tours $5,673 $6,262 $6,912
Posters $350 $368 $386 $406 $426
Total Marketing Expense $19,235 $24,356 $35,206 $39,130 $43,525
Graph 1
2004 2006 2008 2010 2012
Accounting Breakeven Ave Selling Price $255.80 $119.66 $102.93 $97.87 $96.45
Economic 20% IRR Breakeven Selling Price 105.06 110.38 115.97 121.84 128.01
Base Case Ave Selling Price 123.60 129.86 136.43 143.34 150.59

Graph 2
Accounting Breakeven Total Quanity Sold 886 1710 1945 2473 2930
Economic 20% IRR Breakeven Quantity Sold 364 1578 2191 3079 3888
Base Case Total Quantity Sold 428 1,856 2,578 3,623 4,575
S e llin g P ric e p e r C a s e

# of Cases Sold
5000
4500
4000
300
3500
250 3000
Accounting Breakeven
200 Ave Selling Price 2500
Base Case Ave Selling 2000
150 Price
1500
Economic 20% IRR
100 Breakeven Selling Price 1000
50 500
0
0
2004 2006 2008 2010 2012
2004 2006 200
Year Yea
 ANDY - you may want to redo the graphs and
insert the IRR breakeven numbers with the charts
so you will only need 2 in total.
# of Cases Sold

5000
4500
4000
Accounting Breakeven
3500
Total Quanity Sold
3000
Base Case Total Quantity
2500 Sold
2000 Economic 20% IRR
1500 Breakeven Quantity Sold
1000
500
0
2004 2006 2008 2010 2012
Year
 Variable Worst Case Base Case Best Case
Quantity of Sales 50% 100% 105%
Avg. Selling Price 75% 100% 125%
Avg. Fruit Prices 150% 100% 75%
Rate of Growth A B C

NOTE:
A - Start at 1000 cases increase by 250 cases/year
B - Start at 1000 cases and increase every 2 years by 1000 cases
C - Start at 1000 cases and increase constantly by 500 cases/year

Variable Worst Case Base Case Best Case

Quantity of Sales -13.7% 29.8% 33.4%
Avg. Selling Price 12.7% 29.8% 44.9%
Avg. Fruit Prices 25.0% 29.8% 33.1%
Rate of Growth 18.7% 29.8% 34.8%

50.0%

40.0%

30.0%
IRR

20.0%
W
B
10.0%
B

0.0%
1 2 3 4
-10.0%

-20.0% Quantity of Ave. Selling Ave Fruit Rate of

Sales Price Prices Growth
 Worst Case
Base Case
Best Case

3 4

Ave Fruit Rate of

Prices Growth