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Planning & Finance

Business Valuation

An indicative valuation of an owner-managed UK business – five methods, one weighted range

£20

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Business Valuation

Overview

What is my business worth? There's no single right answer – a business is worth what a willing buyer will pay – but valuers use a handful of well-established methods to arrive at a sensible range. This workbook applies five of them to your figures. It starts by 'normalising' your historic profits so they show what a buyer would really earn (paying a manager a market salary to do your job, paying a market rent, ignoring one-offs and personal costs), then values the business on earnings, on forecast cash flows and on its assets. An equity bridge turns business value into share value, a weighted conclusion gives a low–mid–high range, sensitivity tables show what moves the value, and a final sheet estimates what you'd keep after tax on a sale of shares.

Price
£20
Who it’s for
Planning & Finance
Works with
Microsoft Excel for Windows and Mac
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See how it works

A walk through the main sheets

The sheets you will use most, in the order you will use them – shown with the sample data every workbook comes with.

Step 1

Inputs

Business details, five years of P&L, latest balance sheet and equity bridge assumptions. What you do: fill in every yellow cell.

Inputs
Normalisation

Step 2

Normalisation

Adjusts reported EBITDA year by year and calculates maintainable earnings. What you do: enter the adjustments.

Step 3

Multiples

EBITDA and P/E ranges for 17 sectors. What you do: edit to reflect current evidence.

Multiples
DCF

Step 4

DCF

WACC build-up, five-year forecast, terminal value and enterprise value. What you do: enter or check the assumptions.

Who it is for

Made for people like you

  • Example – text
  • Owners thinking about selling or retiring – A realistic range, the drivers of value and an estimate of net proceeds after Business Asset Disposal Relief.
  • Shareholders buying out a partner – A transparent, adjustable basis for agreeing a price.
  • Owners planning ahead – See how much each £1 of extra maintainable profit adds to value, and what normalisation reveals about true profitability.
  • Accountants and advisers – A structured, formula-driven starting point for an indicative valuation discussion.
  • WATCH OUT – This is an indicative estimate, not a formal valuation. Use it to understand the range and the drivers – and speak to your accountant or tax adviser before relying on it for a sale, purchase, divorce, dispute or tax purpose.

Quick start

Up and running in minutes

  1. Example – text
  1. Inputs – the business – Enter the name, choose the closest sector, the valuation date, the tax year of a possible sale, associated companies and how to round the result.
  2. Inputs – historic P&L – Type five years of figures from the statutory accounts, oldest on the left. Set the weights – most valuers ignore unusual years and weight the latest years most.
  3. Inputs – balance sheet – Enter the latest balance sheet, then the cash the business needs day to day and a normal level of working capital.
  4. Normalisation – Enter the market salary for the owner's role, rent paid to you versus market rent, one-off items, personal costs and other adjustments.
  5. Multiples – Check the ranges for your sector against current market evidence and edit if needed.
  6. DCF – Review the cost of capital build-up and the five-year forecast assumptions.
  7. Net Assets – Adjust book values to fair values – property revaluation, plant, bad debts, obsolete stock – and note why.
  8. Valuation – Set the small-company discount, SDE multiples and the weight for each method. Read the conclusion and the checks.
  9. Sensitivity and Sale Proceeds – See what moves the value, then estimate your net proceeds on a share sale.

Key features

  • Five years of historic profit and loss normalised for the owner's market-rate pay, connected-party rent, one-off items and personal costs.
  • EBITDA multiple, maintainable earnings × P/E, discounted cash flow, adjusted net assets and SDE multiple – side by side with low, mid and high values.
  • An equity bridge (debt, surplus cash and working capital), a weighted conclusion and sensitivity tables for the multiple, EBITDA, WACC and growth.
  • Indicative after-tax proceeds on a share sale with Business Asset Disposal Relief, and the points to weigh up on an asset sale. Indicative only – not a formal valuation.

What’s included

  • Dashboard – The valuation at a glance
  • Inputs – Business, historic P&L and balance sheet
  • Normalisation – Adjusted, maintainable earnings
  • Multiples – Sector multiple ranges
  • DCF – Cost of capital and 5-year forecast
  • Net Assets – Book to fair value
  • Valuation – Methods, equity bridge and conclusion
  • Sensitivity – What moves the value
  • Sale Proceeds – Tax on a share sale
  • Tax Rates – UK tax rates by year
  • Guide – How to use this workbook

How buying works

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