Discounted Cash Flow (DCF) Analysis Unlevered

Kosmos Energy Ltd. (KOS)

$6.945

-0.15 (-2.18%)

All numbers are in Millions, Currency in USD

Stock DCF: -2.74 | 6.945 | overvalue

Operating Data

Year A/P	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected	2028 Projected
Revenue	1,499.42	804.03	1,332.01	2,245.35	2,902.93	3,753.08	4,852.21	6,273.23	8,110.41	10,485.63
Revenue (%)
EBITDA	790.41	267.18	829.83	1,624.37	1,600.88	2,069.71	2,675.84	3,459.49	4,472.64	5,782.50
EBITDA (%)
EBIT	135.59	-315.52	56.26	1,115.72	1,152.22	475.93	615.31	795.52	1,028.49	1,329.70
EBIT (%)
Depreciation	654.82	582.71	773.57	508.66	448.66	1,593.78	2,060.53	2,663.98	3,444.15	4,452.81
Depreciation (%)

Balance Sheet Data

Year A/P	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected	2028 Projected
Total Cash	224.50	149.03	131.62	183.40	374.17	483.74	625.41	808.57	1,045.37	1,351.52
Total Cash (%)
Account Receivables	174.29	78.81	177.53	119.73	290.92	376.12	486.27	628.68	812.79	1,050.83
Account Receivables (%)
Inventories	114.41	128.97	165.25	133.52	304.98	394.29	509.76	659.05	852.06	1,101.60
Inventories (%)
Accounts Payable	149.48	221.43	184.40	212.28	441.30	570.54	737.62	953.64	1,232.93	1,594.01
Accounts Payable (%)
Capital Expenditure	-352.01	-379.59	-938	-809.38	-1,285.66	-1,662.18	-2,148.97	-2,778.32	-3,591.98	-4,643.93
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 6.945
Beta	2.763
Diluted Shares Outstanding	474.86
Cost of Debt
Tax Rate	32.79
After-tax Cost of Debt	3.57%
Risk-Free Rate
Market Risk Premium
Cost of Equity	17.524
Total Debt	2,225.91
Total Equity	3,297.88
Total Capital	5,523.79
Debt Weighting	40.30
Equity Weighting	59.70
Wacc

Build Up Free Cash

Year A/P	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected	2028 Projected
Revenue	1,499.42	804.03	1,332.01	2,245.35	2,902.93	3,753.08	4,852.21	6,273.23	8,110.41	10,485.63
EBITDA	790.41	267.18	829.83	1,624.37	1,600.88	2,069.71	2,675.84	3,459.49	4,472.64	5,782.50
EBIT	135.59	-315.52	56.26	1,115.72	1,152.22	475.93	615.31	795.52	1,028.49	1,329.70
Tax Rate	322.07%	1.25%	-79.43%	32.79%	69.17%	69.17%	69.17%	69.17%	69.17%	69.17%
EBIAT	-301.11	-311.58	100.95	749.90	355.23	146.73	189.71	245.26	317.09	409.95
Depreciation	654.82	582.71	773.57	508.66	448.66	1,593.78	2,060.53	2,663.98	3,444.15	4,452.81
Accounts Receivable	-	95.48	-98.71	57.79	-171.19	-85.20	-110.15	-142.41	-184.12	-238.04
Inventories	-	-14.56	-36.28	31.73	-171.46	-89.32	-115.47	-149.29	-193.01	-249.54
Accounts Payable	-	71.95	-37.03	27.87	229.02	129.24	167.09	216.02	279.28	361.08
Capital Expenditure	-352.01	-379.59	-938	-809.38	-1,285.66	-1,662.18	-2,148.97	-2,778.32	-3,591.98	-4,643.93
UFCF	1.70	44.40	-235.50	566.58	-595.39	33.05	42.73	55.24	71.42	92.33
WACC
PV UFCF					-595.39	29.53	34.12	39.42	45.55	52.63
SUM PV UFCF										201.26

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	11.90
Free cash flow (t + 1)	94.18
Terminal Value	951.32
Present Value of Terminal Value	542.22

Intrinsic Value

Enterprise Value	743.48
Net Debt	2,042.51
Equity Value	-1,299.02
Shares Outstanding	474.86
Equity Value Per Share	-2.74