Analyzing Company Capital Structures

Introduction

You're assessing how a company funds operations and growth and what that means for risk and return, so the first question is where money comes from and who gets paid first; in plain terms, capital structure is the firm's mix of debt, equity, and hybrids (preferreds, convertibles), and each piece changes incentives, costs, and downside exposure. For a simple FY2025 example, imagine a business financed with 40% debt, 55% equity, and 5% convertibles: debt lowers headline cost via interest deductibility but raises fixed obligations and default risk, equity avoids fixed payments but dilutes owners and costs more per dollar, and hybrids sit between both. Quick takeaway: capital structure shapes cost of capital, operational flexibility, and downside protection-and that mix directly moves valuation and risk metrics, so treat financing as a strategic lever, not just bookkeeping (defintely worth a close look).

Key Takeaways

• Capital structure (debt, equity, hybrids) fundamentally shapes cost of capital, operational flexibility, and downside protection.
• Monitor core metrics-debt-to-equity, net debt, leverage (net debt/EBITDA), and interest coverage-and include hidden leverage (leases, pensions).
• Debt terms matter: maturities, covenant triggers, fixed vs. floating rates, amortization, and prepayment terms drive near-term default/refinancing risk.
• Equity moves (share classes, dilution from options/convertibles, buybacks/dividends, timing of issuance) signal management's view of valuation and liquidity.
• Build a 3-scenario model with a 36‑month debt ladder and WACC sensitivity; stress-test cash flows, covenants, and governance under adverse markets.

Capital-structure basics and metrics

Break down instruments: senior debt, subordinated debt, common equity, preferred equity, convertibles

You're assessing how the company funds operations and growth, so start by mapping every claim on cash flows and ranking them by legal priority and payment seniority.

Step 1 - list instruments from the balance sheet and footnotes. Include bank loans, bonds, revolver, term loans, capital leases, preferred stock, convertibles, and outstanding options.

• Label senior secured debt: lenders have collateral and first claim.
• Label subordinated/unsecured debt: paid after seniors in distress.
• Label preferred equity: fixed-like dividends, priority to common on payments.
• Label convertibles: hybrid - treat as debt or equity depending on near-term convertibility and accounting treatment.
• Label common equity: residual claim; voting and dilution impact here.

Best practice - build a ranked capital table (maturity, coupon, security, covenants) and keep it updated each quarter. That table should include the maturity date, outstanding balance, and coupon or dividend rate for each instrument.

Example quick math: Fiscal 2025 outstanding balances - bank term loan $400m, unsecured bonds $300m, preferred stock $50m, convertibles $100m, market cap (common) $750m. Put those in a single ranked schedule to see claim size and timing.

One-liner: rank claims first - that ranking decides who loses money in the downside.

Key metrics: debt-to-equity, net debt, leverage (net debt / EBITDA), interest coverage (EBITDA / interest)

Start with canonical formulas and compute using fiscal 2025 line items from the financials you have.

• Debt-to-equity = total debt / shareholders equity.
• Net debt = total debt - cash and cash equivalents.
• Leverage (net debt / EBITDA) = net debt divided by trailing-12-month or pro forma EBITDA.
• Interest coverage = EBITDA / interest expense (use recurring interest only).

Practical steps: pull year-end balances and trailing-12-month P&L for 2025, then compute both GAAP and adjusted metrics (add back one-offs). Recalculate after adjusting debt for leases and pension deficits (see next subsection).

Example quick math using 2025 data: total debt $800m, cash $150m → net debt = $650m. Trailing EBITDA $200m → leverage = 3.25x. Interest expense $40m → interest coverage = 5.0x. Shareholders equity $500m → debt-to-equity = 1.6x.

Benchmarks and action points: for stable sectors, target leverage <2.5x; cyclical or LBO targets often sit at 3.0-5.0x. Interest coverage below 3x deserves covenant and refinancing scrutiny. If coverage is under 2x, plan liquidity actions now - debt reduction or equity raise.

One-liner: metrics convert balance-sheet items into clear risk signals you can monitor monthly.

Use metrics to compare peers and to spot hidden leverage (operating leases, pensions)

Peers only compare cleanly if you standardize adjustments. First, align accounting: IFRS 16 and ASC 842 bring most leases on balance sheet, but historical comparatives may differ.

Concrete steps to standardize peers:

• Compute enterprise value (EV) = market cap + net debt + minority interest - cash.
• Compare EV/EBITDA and net-debt/EBITDA across a tight peer set (same fiscal year 2025 numbers).
• Normalize EBITDA for non-recurring items and add back recurring rent-equivalent for operating leases if not on-balance-sheet.

Spot hidden leverage - items to force into adjusted net debt:

• Operating leases: calculate present value of remaining lease payments (use disclosure schedule). Add to debt.
• Pension deficits: take funded status (plan liabilities - plan assets). Add unrecognized deficit.
• Unfunded guarantees or letters of credit: add face amount.
• Off-balance-sheet recourse liabilities: quantify from notes and add.

Example adjustment math: reported net debt $650m. Present value of operating leases $80m. Pension deficit $40m. Adjusted net debt = $770m. With EBITDA $200m, adjusted leverage = 3.85x, not 3.25x. What this estimate hides - discount rate choice and benefit-plan assumptions can swing the adjusted number materially.

Peer comparison best practices: use identical adjustments, disclose your adjustments, and present both reported and adjusted ratios. If peers report materially lower leverage after adjustments, flag either superior capital structure or reporting differences.

One-liner: adjust for leases and pensions - raw ratios will understate true leverage otherwise.

Debt analysis: terms that matter

You're mapping a company's debt to see where refinancing risk, covenant stress, and cash interest will hit over the next 3-5 years; the immediate goal is a clear, actionable debt ladder, a covenant tracker, and a cash-interest forecast. Here's the direct takeaway: if a large share of debt matures in a single window or covenants sit near trigger levels, refinancing timing often becomes the biggest near-term default risk.

Map maturities and identify refinancing cliffs

Start where filings start: the notes to the financial statements, MD&A, and credit-agreement exhibits. Pull every funded debt line, committed revolver capacity and maturity, commercial paper programs, leases (finance and operating), and off-balance-sheet commitments. Convert all currencies to the reporting currency and list nominal principal, maturity date, next call dates, and contractual amortization.

Steps to build a usable 3-5 year ladder:

• Extract debt items and convert currency
• Group by year and quarter to see concentration
• Separate committed vs uncommitted facilities
• Show scheduled amortization vs bullet maturities
• Include undrawn RCF capacity and required covenant tests

Best practices and red flags:

• Flag any year where > 20% of total debt principal matures - refinancing cliff
• List upcoming call/put windows and make-whole provisions
• Include the maturity of important leases and pension contributions
• Scenario: if $600m of $3.0bn debt (> 20%) matures in Year 1, model rollover need

Practical output: a 36-month schedule showing opening principal, amortization, maturities, expected refinancings, and remaining RCF headroom. This is defintely worth doing before stress-testing covenants.

Test covenants: triggers, cure periods, and waiver history

Collect every covenant definition from credit agreements and indentures (not just the summary table). Covenants are measured differently across instruments - trailing vs forward EBITDA, pro forma adjustments, and excluded items (restructuring, M&A) can change whether a breach occurs.

Concrete steps:

• Itemize covenant types: leverage (net debt / EBITDA), interest coverage (EBITDA / interest), fixed-charge coverage, minimum liquidity, restricted payments
• Record exact calculation language and measurement dates
• Note cure periods, grace periods, acceleration language, and waiver history (SEC filings/8-Ks and press releases)
• Build a covenant tracker that computes covenant ratios for the last 8 quarters and projects forward under scenarios

Here's the quick math to test a leverage covenant example: take trailing twelve-month EBITDA, subtract cash to get net debt, then divide. If trailing EBITDA is $400m and net debt is $1.6bn, leverage = 4.0x. If the covenant cap is 3.5x, you're over the limit and need to model cure options (asset sales, equity raise, waiver).

Best-practice checks and signals:

• Track any covenant holidays or amendment waivers in the last 24 months - frequent waivers indicate lender tolerance limits
• Stress EBITDA down 10-30% and re-run ratios; identify the break-even EBITDA to avoid breach
• Note timing: a covenant test due right before a large maturity is a double hit

Assess cost: fixed vs floating, amortization, and prepayment terms

Cost of debt isn't just the coupon - it's the effective cash interest after hedges, plus amortization and liquidity friction from prepayments. Separate headline spread from floors, caps, and whether the base rate is SOFR (the market standard by 2025) or another benchmark.

Actionable checklist:

• Record coupon, spread, and benchmark (e.g., SOFR + 250bps) for each tranche
• Include rate floors, caps, and existing interest-rate hedges; compute effective blended interest rate
• Map contractual amortization to cash-flow forecasts - higher amortization reduces refinancing need but increases near-term cash interest
• Detail prepayment and call provisions: make-whole, yield maintenance, or simple call/no-call periods

Quick example math: a $200m floating tranche at SOFR + 250bps with expected SOFR of 5.0% yields cash interest of 7.5%, or $15m per year. If a hedge locks the rate at 6.0%, your cash interest falls to $12m. What this hides: hedges cost premium and can create margin calls if rates move.

Other practical considerations:

• Prioritize refinancing or hedging of floating-rate exposure before a projected rate spike
• Model prepayment costs vs market refinancing rates to decide whether to call debt
• Assess covenant resets tied to interest rates or EBITDA - these can change effective compliance

Refinancing timing often drives near-term default risk.

Equity analysis: dilution, priorities, and signals - quick takeaway

You're checking how Company Name's equity moves change control, value per share, and financing flexibility; focus on share-class rules, dilution math, and the timing of buys or raises. Here's the direct takeaway: track current and potential share counts, read capital returns as real cash signals, and treat equity raises during cash stress as a red flag.

Check share classes, voting rights, and dilution risk from options or convertibles

Start by mapping the cap table for Company Name for fiscal year 2025: list share classes, voting rights per share, authorized versus outstanding shares, and all dilutive instruments (options, RSUs, warrants, and convertibles). Use the employment-plan reports and 10‑K/20‑F notes to pull exact counts and exercise/pricing terms.

Concrete steps to run now:

• Pull outstanding common shares and preferred shares from FY2025 balance sheet.
• Pull unexercised options/RSUs outstanding and weighted average exercise price.
• Extract convertibles: face amount, conversion rate, and conversion triggers.
• Compute fully diluted shares using the treasury-stock method for options and straight conversion for convertibles.

Here's the quick math example (illustrative Company Name, FY2025): start with 600,000,000 basic shares; add 50,000,000 in-the-money options; add 40,000,000 convertible shares => fully diluted 690,000,000. Dilution = (690m - 600m)/600m = 15%.

What to watch and why it matters: rights attached to preferreds or dual-class common can block activist or creditor actions and change valuation multiples; anti-dilution clauses and reset protections in convertibles can trigger material share issuance if share price falls. Also check for accelerated vesting on change-of-control - that can spike dilution after an M&A event.

One-liner: check the fully diluted share count and the exercise economics - small option pools can shave >10% off current EPS if in-the-money.

Review capital returns: buybacks, dividends, and retained earnings policy

Scan FY2025 cash flow statements and shareholder‑return disclosures to quantify buybacks and dividends and compare them to free cash flow. Ask: was buyback financed with operating cash or with debt? Prefer cash-funded returns over debt-funded ones.

Practical checks and actions:

• Compute buyback yield = share repurchases in FY2025 ÷ market cap at year‑end.
• Compute dividend yield = total dividends FY2025 ÷ year‑end market cap.
• Compare combined payouts to FY2025 free cash flow and net debt change.
• Flag share repurchases funded by rising net debt or by selling assets.

Example quick checks (illustrative Company Name, FY2025): buybacks $1.2 billion, dividends $300 million, FY2025 free cash flow $1.5 billion, year-end market cap $12.0 billion. Buyback yield = 10%; payout ratio = (1.2+0.3)/1.5 = 100%. That pattern means returns were aggressive and likely consumed strategic flexibility.

Behavioral signals to read: consistent dividend growth signals steady capital allocation discipline; big, opportunistic buybacks at low valuations suggest management sees undervaluation; buybacks timed before equity raises or insider sales can be eyebrow-raising. If buybacks occur while net leverage rises, treat future equity issuance probability as higher.

One-liner: if FY2025 buybacks consumed >50% of free cash flow and net debt increased, expect higher dilution risk later.

Read issuance timing: equity raises during distress signal higher risk

Timing of issuance is information. Pull FY2025 equity capital raises, including follow-ons, shelf takedowns, ATM programs, and convertible issues. Note proceeds, use of proceeds, and the share price relative to prior trading range on the deal date.

How to evaluate issuance events:

• Record date, gross proceeds, shares issued, and deal price for each FY2025 issuance.
• Compute effective issuance discount: average prior 30‑day VWAP vs deal price.
• Check stated use of proceeds: refinancing, M&A, operations, or general corporate purposes.
• Cross-reference liquidity position: cash balance, 12‑month cash burn, and upcoming maturities when issuance occurred.

Interpretation rules of thumb: equity issued at a meaningful discount to prevailing price often means the issuer had limited choices; equity issued at or above prior VWAP can signal confidence. For FY2025, if Company Name issued $800 million at a 15% discount to 30‑day VWAP while cash fell $400 million vs prior year, treat the raise as distress-driven rather than opportunistic.

One-liner: equity moves reveal management's view of valuation and liquidity - raising equity at a discount usually flags higher downside risk.

Cost of capital and valuation impacts

You're assessing how Company Name's funding mix affects valuation and where to push capital structure changes so they actually widen returns, not risk. Here's the direct takeaway: calculate WACC from market values, stress the tax shield, and run a sensitivity that captures how small moves in debt cost or leverage change enterprise value.

Calculate WACC: cost of equity and after-tax cost of debt weighted by target structure

Step 1 - assemble market-value weights: use Company Name's FY2025 market capitalization and FY2025 net debt to get equity and debt weights. If market cap = $8.5 billion and net debt = $2.5 billion, total capital = $11.0 billion, so equity = 77% and debt = 23%.

Step 2 - cost of equity: use CAPM (capital asset pricing model). Pick a risk-free rate (10-year Treasury), an equity risk premium (ERP), and Company Name's beta. Example FY2025 inputs: Rf = 4.00%, ERP = 5.50%, beta (levered) = 1.10. Then Re = 4.00% + 1.10×5.50% = 10.05%.

Step 3 - after-tax cost of debt: use Company Name's weighted-average interest on debt. Example FY2025 average coupon = 5.50%, statutory combined tax rate = 25%, so after-tax cost = 5.50%×(1-0.25) = 4.13%.

Step 4 - compute WACC: WACC = We×Re + Wd×Rd×(1-Tc). With example weights equity 77% / debt 23%: WACC = 0.77×10.05% + 0.23×4.13% = 8.17% (rounding differences vs other weightings are expected). Here's the quick math so you can reproduce it in your model.

• Get market cap and net-debt at fiscal year-end (FY2025).
• Use forward-looking Re inputs tied to your valuation horizon.
• Use marginal cost of debt for refinancing-relevant decisions.

Understand tax shield benefits vs higher default risk from more debt

Step 1 - value the tax shield: for a simple perpetual-debt view, the present value (PV) of the tax shield approximates Debt×Tax rate. If Company Name borrows an incremental $1.0 billion at FY2025 rates with a 25% tax rate, PV shield ≈ $250 million. Annually the interest tax saving = 1.0bn×5.50%×0.25 = $13.75 million.

Step 2 - cost vs. benefit trade-off: the shield raises enterprise value but increases default and distress costs. Practically, model both effects: (a) add PV tax shield to unlevered EV and (b) apply an expected distress-cost haircut that rises with net-debt/EBITDA.

Step 3 - quantify default risk uplift: when leverage increases, both the cost of debt and the cost of equity typically rise. Use Hamada's formula to adjust beta for leverage: Beta_L = Beta_U × [1 + (1-Tc)×(D/E)]. Example: unlevered beta = 0.90, D/E = 0.30/0.70 = 0.4286, Beta_L ≈ 1.19, which raises Re and offsets some benefit of the tax shield.

• Stress-test covenant breaches and liquidity covenants.
• Prefer term debt with staged amortization to lump-sum refinancing.
• Model incremental cost of capital at the margin, not just the blended historical rate.

Model scenario: WACC sensitivity to +/- 2-4 percentage-point changes in debt cost

Set up a simple sensitivity table in the model using your base-case inputs (from above). Use marginal debt-cost moves of -2, +2, +4 percentage points around FY2025 cost. Keep equity cost fixed in the first pass, then run a linked scenario where higher debt raises beta and Re.

Example base assumptions for Company Name FY2025: Re = 10.05%, tax rate = 25%, capital structure target = equity 70% / debt 30% (for sensitivity clarity). Compute after-tax debt costs and resulting WACC:

• Debt cost 3.50% → after-tax 2.63% → WACC ≈ 7.82%.
• Debt cost 5.50% → after-tax 4.13% → WACC ≈ 8.27% (base).
• Debt cost 7.50% → after-tax 5.63% → WACC ≈ 8.72%.
• Debt cost 9.50% → after-tax 7.12% → WACC ≈ 9.17%.

Translate WACC moves to valuation: assume perpetual FCF of $500 million. Enterprise value = FCF / WACC gives:

• At WACC 7.82% → EV ≈ $6.39 billion.
• At WACC 8.27% → EV ≈ $6.04 billion.
• At WACC 9.17% → EV ≈ $5.45 billion.

What this estimate hides: equity cost usually rises with leverage (via beta) and credit spreads widen non-linearly near covenant thresholds - so WACC sensitivity using fixed Re understates downside when leverage jumps. In practice, re-run the table with Hamada-adjusted betas and a stressed credit spread add-on.

Small changes in leverage can meaningfully change valuation via WACC.

Next step - Finance: build a WACC sensitivity workbook for Company Name using FY2025 market values, a 36-month debt ladder, and scenario sets (base, downside, severe) by Friday; strategy will review capital targets next week.

External, governance, and stress-test considerations

You're assessing whether a company's leverage is opportunistic or a problem for the next downturn; start by mapping how macro moves, governance, and stress scenarios translate into cash and covenant outcomes. Quick takeaway: monitor rate and spread paths, board and creditor dynamics, and run 36-month stress tests tied to a clear debt ladder.

Macro risks and market cycles

First, translate market moves into borrowing cost and covenant pressure for this specific balance sheet. Build three forward-rate scenarios tied to plausible 2025 paths you'll use in models: a stable-rate base, a moderate shock, and a severe shock. For modeling, use clear numeric shocks: base: short-term rate change ±0-50bps; moderate: +150-250bps; severe: +350-500bps. For credit spreads, model widenings of +100bps, +250bps, and +400bps respectively.

Here's the quick math: each 100 basis-point (1.0%) increase on $1.0 billion of debt raises annual interest by $10 million; on $2.5 billion it's $25 million. What this estimate hides: floating vs fixed mix, existing hedges, and capitalized interest can change timing materially.

Practical steps and best practices:

• Map floating vs fixed debt and hedge maturity
• Stress net-debt by rate + spread moves
• Test revolver draw assumptions under frozen capital markets
• Compare sector peers' spread moves over prior cycles

One-liner: small moves in rates and spreads turn manageable interest expense into real covenant and liquidity stress.

Governance, creditor rights, and disclosure quality

Governance decides whether a stressed company restructures cleanly or burns stakeholder value; focus on board makeup, creditor protections, and the firm's disclosure granularity. Look for independent director share of board (preferably > 50%), presence of directors with turn-around or credit experience, and clear escalation protocols with lenders.

Key creditor-rights checks and practical actions:

• Confirm security profile: senior secured, unsecured, or subordinated
• Review intercreditor agreements and priority of collateral
• Pull historical waiver requests and covenant amendments
• Check disclosure: schedule of debt maturities, off-balance leases, pension deficits
• Assess lender mix: banks vs institutional vs holdco debt

Best practice: create a creditor map showing claims and cure timelines, and flag any unilateral management powers to issue new debt or pref shares without lender consent. If disclosures are thin, treat assumed recoveries as 20-40% lower in your downside models - defintely adjust for opacity.

One-liner: weak governance or murky disclosures raise the haircut you should assume in recoveries and the chance of value-destroying restructurings.

Run stress tests: cash-flow shocks, covenant breaches, and refinancing under tighter spreads

Stress tests must be numeric, actionable, and tied to a 36-month debt ladder. Build three scenarios with specific inputs and outputs so you can say when a covenant breaks and what options remain.

Scenario templates (use these as starting points):

• Base: revenue flat, EBITDA margin steady, spreads +0-100bps
• Downside: revenue -10%, EBITDA margin -300bps, spreads +200-250bps
• Severe: revenue -25%, EBITDA margin -700bps, spreads +400-500bps

Concrete tests to run and metrics to capture:

• Run a 36-month cash-flow waterfall: operating cash, interest, capex, dividends, mandatory amortization
• Calculate covenant trajectories: net-debt/EBITDA, interest coverage (EBITDA/interest), and fixed-charge coverage monthly
• Model refinancing at market pricing: assume revolver or new term loan priced at current yield + stress spread (example: base lender margin 150bps, stressed margin 450bps)
• Quantify runway: months until covenant breach or liquidity $0 under each scenario

Example math: with net debt $1.5 billion, a +300bps spread increases annual interest by $45 million; if EBITDA falls from $300 million to $220 million, interest coverage drops from 5.0x to 2.4x, likely breaching a 3.5x covenant.

Mitigation playbook to pre-map (ranked by speed):

• Draw revolver and negotiate short forbearance
• Pause buybacks/dividends and conserve 25-50% of free cash flow
• Sell non-core assets to raise 1-2 quarters of liquidity
• Request covenant waivers early; document cure plan
• Negotiate term extensions or incremental liquidity with new security

One-liner: run the three scenarios, and you'll know exactly when refinancing timing creates a real default risk - not just a theoretical one.

Next step and owner: Finance - build the 36-month debt ladder, run these three scenario stress tests, and deliver a covenant tracker by Friday.

Conclusion and next steps

You're closing the capital-structure review and need a concrete, executable plan: build a three-scenario financial model anchored on FY2025 actuals, a 36-month debt ladder, and a WACC sensitivity table so you can see valuation and refinancing risk in numbers. Quick takeaway: finish the model by November 28, 2025 so leadership can act before the next funding window.

Build a three-scenario model anchored on FY2025 actuals

You should start with the FY2025 reported line items: revenue, EBITDA, operating cash flow, capex, interest expense, and closing net debt from the 10‑K/10‑Q. Use those as the baseline inputs - don't guess. Then create three clear scenarios with specific, testable deltas.

Step-by-step:

• Pull FY2025 actuals: revenue, EBITDA, EBIT, interest expense, capex, working-capital levels, closing net debt.
• Define scenario assumptions in percent changes from FY2025: Base: revenue growth +3-5%, EBITDA margin change ±0-100 bps; Downside: revenue 0-2%, margin -200-400 bps; Severe: revenue -10-25%, margin -400-800 bps.
• Rate shock: set debt-cost shocks relative to FY2025 blended rate - Base: FY2025 WACD (weighted average cost of debt); Downside: WACD + 200 bps; Severe: +400 bps.
• Run cash-flow waterfall: EBITDA → NWC changes → capex → interest → taxes → Free Cash Flow. Project 36 months monthly or quarterly.
• Produce outputs: 36-month cash balance, default / covenant breach flags, and valuation impacts (NPV using scenario WACC).

Here's the quick math: if FY2025 net debt is $500 million and average debt cost rises by 200 bps, interest expense increases by about $10 million annually - that's immediate EBITDA sensitivity. What this estimate hides: amortization schedules and floating-rate floors can change timing and magnitude.

One-liner: build scenarios off FY2025 facts so refinancing cliffs and liquidity shortfalls show up in months, not surprises.

Produce the deliverables: net-debt schedule, covenant tracker, equity-dilution table

Deliverable templates must be precise, formula-backed, and ready to drop into presentations. Ship CSVs and a linked Excel model with clear inputs and assumptions tabs.

Net-debt schedule (36 months):

• Columns: Period (month), Opening cash, Operating cash flow, Capex, Tax, Interest paid, Debt principal repayments, New borrowings, FX/other, Closing cash, Gross debt, Short-term debt, Long-term debt, Net debt = Gross debt - Closing cash.
• Populate with contractual amortization and revolver utilization. Highlight refinancing maturities and required rollovers.

Covenant tracker:

• Columns: Lender, Facility, Principal, Maturity date, Covenant type (leverage, interest coverage, fixed-charge), Covenant formula, Reporting period, Current metric (TTM EBITDA, Net debt/EBITDA, EBITDA/Interest), Covenant threshold, Cure/waiver history, Next test date.
• Include automated flags: red if within 0.25x of covenant or if next test occurs within 90 days.

Equity-dilution table:

• Columns: Outstanding shares (FY2025), Options / RSUs outstanding, Fully diluted shares, Convertible instruments (principal, conversion price), Potential dilution %, Recent buybacks, Planned raises.
• Model issuance scenarios: equity raise size needed to avoid covenant breach; show dilution %, post-money share count, and per-share price sensitivity.

Example deliverable note: include a one-page dashboard with Net debt trajectory, next two maturities, and a covenant heatmap so the CFO can see risk at a glance. Defintely attach source links to FY2025 filings.

One-liner: deliverables must move decisions - not just numbers on a sheet.

Assign owners, timelines, and immediate tasks

Clear ownership and tight deadlines force work to completion. Assign tasks, not vague responsibilities.

• Finance (Company Name Finance): Draft the 36-month debt ladder and three stress scenarios using FY2025 actuals. Due Friday, November 28, 2025. Deliver Excel and CSV.
• FP&A: Build the scenario income-statement and cash-flow model, produce WACC sensitivity table, and show valuation delta for WACC moves of ±2-4 percentage points. Due Wednesday, December 3, 2025.
• Treasury: Run refinancing options for maturities inside 12 months and price indicative bids (bank lines, bond taps, term loan). Due Wednesday, December 3, 2025.
• Legal & Corp Dev: Pull and verify all covenant language and amendment history; supply documentation for covenant tracker. Due Tuesday, December 2, 2025.
• Strategy: Review capital targets and propose target leverage bands (e.g., Net debt/EBITDA target and maximum). Convene review meeting Thursday, December 4, 2025.

Tools and best practices:

• Use monthly granularity for the first 12 months, then quarterly.
• Link all schedules to a single drivers tab so scenario switches update everywhere.
• Keep a clear assumptions sheet with sources and FY2025 citation lines.
• Automate covenant flags and include sensitivity toggles for interest spreads.

One-liner: owner + date = accountability - Finance drafts the ladder by Nov 28, 2025; strategy reviews targets the following week.