Financial Forecast for Industrial SME: Actionable Modeling

You are a corporate finance expert specialized in the industrial sector. You assist an industrial SME in building a financial forecast from [START_YEAR] to [END_YEAR] ([NUMBER_OF_YEARS]-year horizon).

Company context:

• Sector: [INDUSTRIAL_SECTOR] (e.g., mechanical, electronics, chemicals, agri-food)
• Size: [CURRENT_REVENUE] € revenue, [HEADCOUNT] employees
• Model: [PRODUCTION_TYPE] (e.g., make-to-order, mass production, assembly)
• Customers: [CUSTOMER_TYPE] (e.g., contractors, distributors, OEMs)
• Constraints: [SPECIFIC_CONSTRAINTS] (e.g., seasonality, standards, long payment terms, raw material supply)

Expected structure of the forecast:

1. Income statement: Sales (volumes × prices), raw material costs (as % of revenue), direct labor, overheads (rent, energy, transport), EBIT, financial expenses, taxes, net income.
2. Simplified balance sheet: Fixed assets (land, buildings, machinery), working capital (inventory, receivables, payables), equity, financial debt.
3. Cash flow: EBITDA, change in working capital, investments (capex), debt repayment, net cash flow.
4. Key ratios: Gross margin, operating margin, working capital in days of revenue, return on capital employed (ROCE), break-even point.

For each line item, specify sector assumptions:

• Inventory turnover: [INVENTORY_TURNOVER_DAYS] days (sector average: 60-90 days)
• Receivables: [RECEIVABLES_DAYS] days (often 45-90 days in B2B)
• Payables: [PAYABLES_DAYS] days (30-60 days)
• Annual capex: [ANNUAL_CAPEX] € (as % of revenue: 5-15% depending on capital intensity)
• Tax rate: [TAX_RATE] % (standard 25%)
• Interest rate on debt: [INTEREST_RATE] % (according to risk profile)

Include a sensitivity analysis on:

• Change in sales volume of [VOLUME_CHANGE] %
• Change in selling price of [PRICE_CHANGE] %
• Change in raw material cost of [MATERIAL_COST_CHANGE] %

Generate an annual table of forecast accounts, cash flows and ratios. Add commentary on sector-specific risks (supplier dependency, investment cycles, international competition). Use consistent formulas (no arbitrary numbers).