Assume you are an analyst tasked with valuing a hypothetical company, ABC

Corporation, using the Discounted Free Cash Flow to Firm $($FCFF$)$ method.

You have gathered the following information:

Financial Information:

Net Profit: $$10$ million

EBIT: $ $14$ million

Financial expenses: $ $1\mathrm{.}5$ million

Depreciation and Amortization: $$5$ million

Capital Expenditures: $$8$ million

The cost of the own capital $($Ke$)$ is $15\%$

Changes in Net Working Capital: $$2$ million

Tax Rate: $20\%$

Total financial debt: $$20$ millions

The company financial structure is as follow: $40\%$ own funds, $60\%$ debt.

requirement  

 

What is the EV if the FCFF is expected to grow at $2\%$ per year in the upcoming $5$ 

 

years, and the constant growing rate is $1\%?$