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History years in the model

History years are very easy to use in the company models when you remember the colour codes:

In the beginning you are allowed to change blue figures. The black ones are calculated by the model.

When you change blue figures, they become red which you are also allowed to change.

(If you would like to reset red colours back to blue, click first Tracking off and then Tracking on.)

The minimum requirement of the model for history years is to fill at least the last actualised year. The years before that are in practise only for easier estimating and statistical use.

Notice that usually you do not need to change history years at all. The most obvious reason for doing it, is when you start to fill an empty model.

 

Income statement: Net sales and EBIT

Net sales and EBIT have the similar logic between themselves: only the cumulative figures are allowed to change.

A change for example in Q1 does not affect the following quarters at any way.

 

Income statement: other parameters

For the other (blue) Income statement parameters in history years, you have three possibilities to fill in figures or change them:

  1. Using only full-year level or
  2. Using quarters with
    1. absolute figures or
    2. cumulative figures

When quarters are used, you can enter a figure either to the absolute or cumulative figures. The model calculates the other to correspond to the change.

If you enter a figure to the full-year level, the model calculates new Q4-figure. Notice however that if the quarters are not in use, Q4 shows the same figure as the full-year level.

 

Balance sheet

Balance sheet can be filled in using the colour codes.

 

Other parameters

So that the model could calculate the key figures (EPS, P/E etc) also for the history years, there are a couple of parameters that must be filled in addition to Income statement and Balance sheet parameters:

  • No of shares at year end
  • Share price
  • Dividend per share
  • Stock issue multiple (if necessary)
  • WACC's parameters

WACC can be found e.g. from Financial key value drivers and the others from Capitalization section. (Stock issue multiple under Adjusted figures in Capitalization section.)

 

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