Portfolio summary
R&D Pipeline Portfolio · Amounts in USD, millions
Group value after unallocated costs is +$147.9M at 10.00% WACC. It starts from the sum of item values, +$616.6M, less unallocated costs of $468.7M. Sample data. A screening and scenario view, not a company valuation.
Scenario: Base. One shared WACC of 10.00% is a simplifying assumption. Riskier items may look better than they should. Terminal value is 53% of value. 11 items have a success probability below 50%, which is an invented sample input. Sum of item values +$616.6M, less unallocated costs $468.7M, gives group value +$147.9M. SG&A, R&D and admin are assumed rates on revenue, charged to each item. Unallocated group costs are sample inputs, shown on the Group bridge page. No eliminations are modelled.
The model is a working prototype on invented data. It is not finance validated or decision ready until cash flows reconcile to a group view.
Key takeaways
- ■Value: Mature (cash cow) adds the most NPV, at $539.0M.
- ■Risk: 18 of 40 items have negative modeled NPV under the selected assumptions and WACC. Review before a decision.
- ■Spread: The portfolio earns 12.57% against a 10.00% cost of capital.
Metric definitions
| Item value (NPV) | Operating business: going-concern value, net of its capital base. R&D initiative: expected project value before comparison to the baseline, since no without-project case is modelled. Enterprise basis, before debt. Not a company valuation. |
| Three measures | Sum of item values. Group value after unallocated costs. Equity bridge value after other non-operating items and debt. The scope selector picks which one the headline, risk adjusted value and exports use. |
| Cash flow | NOPAT, less maintenance capex, less growth in working capital. D&A is assumed equal to maintenance capex, so they cancel. Interest and debt flows are excluded. |
| Terminal value | Operating businesses: perpetual growth on a normalised year-10 flow. R&D initiatives: cash flows stop after the commercial life (default 20 years from launch, working capital recovered, no other salvage). Share of value shown above. |
| Probability of success | Cumulative chance that an R&D initiative reaches launch and earns its forecast. It scales the commercial cash flows and terminal value. It is a sample input, not an estimate. |
| Staged funding | R&D capex is split. The upfront part is spent at year 0 for certain. The held-back part is spent at the first gate (year 2 for pipeline, year 1 for early) and only if the gate is passed. The gate probability is conditional by stage and is never used below the cumulative PoS. No extra risk premium is added to WACC. |
| IRR | From expected cash flows including terminal value. Supplemental to NPV. |
| ROIC (proxy) | Average expected NOPAT divided by year-0 capex. Capex is a stand-in for invested capital. |
| Payback | Undiscounted, on expected cash flows, within the 10 explicit years. Blank if later. |
| Capex | Year-0 investment, or the capital base for running businesses. Remaining investment by year is not yet shown. |