The company will miss its annual EBITDA forecast by 15%. How do you prepare the board pack and discussion?
What the interviewer wants to hear
- Lead with the headline number and the size of the gap
- Bridge from forecast to latest outlook by driver
- Separate one-off and structural causes
- Show the cash, covenant and funding impact
- Present corrective actions with owners and a revised outlook
Model answer
Boards dislike surprises more than bad news, so I would lead with the message on the first slide: we now expect EBITDA of 85 against a forecast of 100. Then I would show a bridge from 100 to 85 by driver, for example volume shortfall, price pressure, raw material inflation and a one-off provision, each with a number. I would separate one-off items from structural issues, because the board needs to know if next year is also at risk. I would show the impact on cash, debt and any bank covenants, since that is often the real risk. Then I would present the management actions, such as cost savings or pricing changes, with owners, timelines and the value expected, and a revised outlook with an upside and downside range. I would pre-brief the CFO and audit committee chair, and keep the detail in an appendix.
Can you answer it under time pressure?
Take a timed hard round and get scored on every answer.
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