Most companies are faced with questions such as: which projects should your company invest in, which returns are needed and what risks are the company willing to take to achieve company goals?

Our approach
In evaluating a proposed investment we pay particular attention to deciding what information is relevant to the decision at hand and what information is not. The effect of taking on a project is to change the company’s overall cash flows today and in the future. To evaluate a proposed investment, we consider these changes in the company’s cash flow and decide whether or not they add value to the company.

Our approach builds on traditional discounted cash flow (DCF) analysis and adds explicit modelling of the underlying uncertainties and risks. We use advanced simulation software to capture the complex and inter-dependant parameters required for forecasting the spread in future asset performance (revenue and operating expenditure) year-on-year.

Important parameters include:

• Production capacity profiles
• Demand profiles
• Product prices
• Physical asset layout and design
• Equipment reliability performance
• Maintenance and repair activities
• Operation activities.

Our strong modelling capability based on Monte Carlo simulation analysis helps us to develop solution options with you to arrive at the best investment.

Benefits
DNV's consulting services provides clients with:

• An accurate forecast of future cash flows and associated risks
• Understanding of potential risk mitigating actions
• Understanding of the value of flexible strategies
• A "Road-map" on how to manage the execution part of the investment
• Understanding of the effect on related portfolio return and portfolio risk
• Transparent and scientific process of capital allocation
• Independent expert advice on technical or commercial matters