Development of a financial model for OMILAYE in Benin

OMILAYE is a Beninese company that manages two leasing contracts for the operation of water services in rural areas, in several departments of Benin. Omilaye was created in 2021 following the selection of the ERANOVE, VERGNET HYDRO and UDUMA consortium by the Beninese authorities. Phoenix Consulting International, in collaboration with Artelia, was commissioned by the consortium in 2020 to design the prospective business plan.
Phoenix is now continuing its support work by assisting Omilaye to build an operational financial model, to enable the newly-created structure to monitor and anticipate the financial performance of the 2 leasing contracts, on the one hand, and of the company, on the other.
This model is based on historical and current data for the two services (past financial statements, infrastructure in operation, households connected to the network, charges, etc.), contractual commitments (tariffs, obligations, etc.) and projection assumptions (failure rates, demand profiles, cost of financing, etc.) to build a prospective financial tool.
The model constructs growth trajectories for water production and sales, but also for the operating investments required and the costs generated by the development of the service. It presents the financial profitability for each of the two contracts and on a consolidated basis, making it possible to compare these different scenarios. In this way, the sensitivity of a change in certain key parameters to the financial equilibrium of the contracts can be measured. More broadly, it highlights the financial requirements, risks and room for manoeuvre over the life of the contract.
This work for OMILAYE illustrates Phoenix’s commitment to providing turnkey solutions for operators of essential services in the developing world.