Overview

This course takes a deep dive into the world of project finance, where you will learn to build financial models from the ground up using Excel. Whether you're new to finance or looking to sharpen your modeling skills, this course introduces key concepts in project finance, such as understanding eligible transactions and building input assumption sheets. Using a real-world case study, the course will guide you step by step through the intricacies of financial modeling, including multi-scenario input sheets and timeline assumptions. In the second phase, you'll explore more advanced topics such as the construction phase and debt sizing, which are essential for forecasting costs and revenue accurately. The course provides hands-on experience with building detailed financial statements like the Profit & Loss statement, Cash Flow Waterfall, and Balance Sheet. Throughout, you'll develop a comprehensive understanding of how to construct models that are both dynamic and adaptable to real-world projects. Finally, you will wrap up by calculating return metrics like the Internal Rate of Return (IRR), which is crucial for assessing project viability. By the end of the course, you’ll be fully equipped to handle every stage of a project’s financial modeling lifecycle, from initial assumptions to detailed cash flow forecasts and financial statement analysis. This course is designed for finance professionals, analysts, and anyone looking to specialize in project finance. A basic understanding of Excel is recommended, though no prior finance experience is necessary. Those with an interest in infrastructure, energy, and large-scale project financing will benefit from the practical skills covered.

Syllabus

A Quick Refresher on the Basics

In this module, we will explore the fundamental concepts of project finance, making the material accessible to beginners without a finance background. We will break down the definition of project finance and discuss the types of transactions suitable for this financing method, focusing on industries like transportation, power, and the environment.

Building a Project Finance Model from Absolute Scratch

In this module, we will delve into a real-world case study, "Express Fiji," a project involving the construction and operation of a highway in Fiji. This section sets the stage for building a complete project finance model from scratch, helping you gain insights into the real-world applications of the skills you're about to learn.

Laying Down the Foundations

In this module, we will focus on creating the foundation of a robust financial model by first understanding the anatomy of a multi-scenario input sheet. We will then proceed to build the input assumptions sheet, which forms the backbone for the rest of our financial model.

Project Timeline and Time-Based Assumptions

In this module, we will build a sheet dedicated to the project's timing and explore the mechanics behind timing flags. These are essential for organizing the project phases and performing detailed computations across different time periods in the financial model.

Visualizing the Construction Phase

In this module, we will focus on visualizing the construction phase of a project, starting with the sources and uses of funds. We will then dive into debt sizing and the circularity of funds, ensuring a deep understanding of how these elements interact during construction.

Modeling the Operational Phase: Total Revenues and Costs

In this module, we will begin modeling the operational phase by building the operations sheet. Here, we will connect the financial data from the construction phase to track revenue generation and operating costs for the project's lifecycle.

Building the Three Key Financial Statements

In this module, we will build the core financial statements, including the profit and loss statement, balance sheet, and cash flow statement. We will cover crucial aspects like debt repayment schedules, cash flow waterfalls, and amortization, giving you a complete understanding of financial statement construction.

Cash Flows, Returns, and Target IRR

In this module, we will compute important return metrics, including the Internal Rate of Return (IRR), and analyze all cash flows for the project. This final step will tie together the work done across previous modules, helping you assess the financial viability of the Express Fiji project.