Agribusiness Banking Chris Horan Senior Partner Agribusiness Waikato

Agribusiness Banking Chris Horan – Senior Partner Agribusiness, Waikato Nick Coster – Partner Agribusiness, Morrinsville Laura Brown – Senior Associate, Hamilton

Information Required by the bank • Finance requirement – building additional shed. • Financial analysis. • Timing - when do key events take place? • Operational outline – staffing, trading, product mix etc. • Marketing strategy & target market. • Key risks and mitigates. • Contingency plan, what are our fall back options and what triggers them? • Goals and aspirations, how do we measure success?

Strategic Capital Project – Building additional calf shed? What is required? • Ø • Building 5 bay shed = $15, 000 Machinery New Quad = $15, 000 Other Sundry – additional feeders, troughs, hay = $5, 000 Total loan required = $35, 000

Strategic Capital Project – Shed build Statement of Position – Chris and Karin Assets Liabilities Land & Buildings $ 1, 000 Term Loan $ 600, 000 Stock $ 25, 000 Working Capital $ 20, 000 Plant & Machinery $ 70, 000 Investments/Shares $ 250, 000 Sundry $ 25, 000 Total Assets $ 1, 370, 000 Total Liabilities $ Total Equity $ 750, 000 Total Equity % 54% 620, 000

Debt Servicing – Break out exercise Assumptions: • Current shed, 8 bays, capacity 130 calves per run, 2 runs per year. • 5 bay shed capacity? How many more calves could I do? • 10% death rate.

Outcomes of proposal: • Should I do build the shed? • Where could results improve? • What are threats to making it a success? • What type of loan should I consider? • Other questions?