Section 5.13 · three cases, five years
Forecasts
Every figure on this screen is a forecast and is tagged as one. Nothing here is evidence, and nothing here is allowed to move a screening decision on its own.
Forecast provenance is separate from estimate provenance. An estimate fills a gap in the past. A forecast asserts something about the future. The Stage 2 report renders them differently, and the number guard refuses to let a forecast be quoted as a fact.
Base year 5 EBITDA
£723,000
Forecast
Downside year 5
£525,000
Forecast
Upside year 5
£866,000
Forecast
Probability weighted
£702,100
55 / 25 / 20 weighting
Base case
| £000 | FY2025 actual | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|---|
| Revenue | 4,120 | 4,120 | 4,326 | 4,499 | 4,679 | 4,819 |
| Revenue growth | 9.0% | 0.0% | 5.0% | 4.0% | 4.0% | 3.0% |
| Normalised EBITDA | 585.2 | 585.2 | 627.0 | 662.0 | 697.0 | 723.0 |
| EBITDA margin | 14.2% | 14.2% | 14.5% | 14.7% | 14.9% | 15.0% |
| Cash available for debt service | — | 390.8 | 435.3 | 458.8 | 477.0 | 493.4 |
Year 1 holds revenue flat. A change of ownership in an owner-influenced business is a risk to the first year, not an opportunity, and the historic 9.9% growth rate is not carried into it.
Downside case
| £000 | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|
| Revenue | 4,120 | 3,996 | 3,916 | 3,916 | 3,955 |
| Growth | 0.0% | −3.0% | −2.0% | 0.0% | 1.0% |
| EBITDA | 585.2 | 550.0 | 528.0 | 522.0 | 525.0 |
| Margin | 14.2% | 13.8% | 13.5% | 13.3% | 13.3% |
| DSCR | 1.78× | 1.82× | 1.77× | 1.73× | 1.72× |
Drivers: one mid-sized contract lost and not replaced, wage inflation running one point ahead of price indexation, no new tender wins.
Upside case
| £000 | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|
| Revenue | 4,120 | 4,532 | 4,940 | 5,335 | 5,708 |
| Growth | 0.0% | 10.0% | 9.0% | 8.0% | 7.0% |
| EBITDA | 585.2 | 683.0 | 751.0 | 812.0 | 866.0 |
| Margin | 14.2% | 15.1% | 15.2% | 15.2% | 15.2% |
| DSCR | 1.78× | 2.16× | 2.37× | 2.53× | 2.69× |
Drivers: historic growth rate sustained, one additional multi-year contract won in each of years 2 and 3, margin held rather than bought.
EBITDA path, three cases
The downside year 5 sits below today's normalised earnings. That is deliberate. A forecast whose worst case still grows is not a forecast, it is a sales document.
Driver assumptions
| Driver | Downside | Base | Upside | Source of the assumption |
|---|---|---|---|---|
| Contracted revenue retention | 88% | 94% | 97% | Operator assumption table v3, 1 July 2026 Assumption |
| Tender win rate on rebids | 40% | 60% | 75% | Operator assumption table v3 Assumption |
| Price indexation on contracts | 2.0% | 3.0% | 3.5% | Contract terms not supplied, assumption used |
| Wage inflation | 4.5% | 3.5% | 3.0% | Operator assumption table v3 Assumption |
| New contract wins, years 2 to 5 | 0 | 2 | 4 | Pipeline not supplied, assumption used |
| Maintenance capex, share of EBITDA | 10.7% | 10.7% | 10.7% | Three-year filed history Verified |
| Working capital, share of revenue | 9.2% | 9.2% | 9.2% | FY2025 balance sheet Verified |
Two of the seven drivers rest on data the seller has not supplied. Both are listed as open gaps and both are conditions on any offer.
What would invalidate the base case
- A contract expiry ladder showing more than 30% of contracted revenue expiring inside 18 months
- Price indexation absent from the top five contracts, which would put margin at the mercy of wage inflation
- Current-year management accounts showing revenue below the FY2025 run rate
- The owner's duties turning out to include named-individual contract obligations
- Any customer notice served but not disclosed
The first three of these are open gaps today. The base case is therefore a working assumption, not a conclusion, and the recommendation is written to say so.
How forecasts are allowed to be used
| Use | Permitted |
|---|---|
| Return and cover modelling | Yes |
| Stress and reverse stress testing | Yes |
| Exit value estimation | Yes, tagged |
| Screening pass or fail | No |
| Quality score components | No |
| Quoted in narrative as a fact | No |
| Presented without a forecast tag | No |
Screening and scoring run on filed and verified history only. A business cannot screen in on the strength of its own projections.
AcquiScope produces analysis and modelling, not regulated investment advice. Every forecast on this screen is an assumption about an invented business, not a prediction and not a representation. Forecasts are not evidence.