Metal Fabrication,Assembly & On-Site Installation Co. Long Term Growth

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PRICED BELOW THE MARKET! High Profit Margin, Great Rep, Long Term Employees
Asking Price:
$1,200,000

Gross Revenue:
$1,990,000
Cash Flow:
$471,000
EBITDA:
$471,000
Inventory:
 Not Disclosed

FF&E:
$225,000
included in asking price

Real Estate:
$1,200,000
not included in asking price

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Business Description

They specialize in Architectural/Structural Iron, Stairs/Handrails, Pipe/Tube Bending, Ornamental/Custom Fabrication, Manufacturing, Prototyping, and Machining.

The trailing 12 months revenues through October 31 2018 were 1.99M with 471K in earnings. 2017 had 1.63M in revenue with 429K in earnings. This company has seen long term growth and expects that to continue.

This company is worth over 3 times its normally adjusted earnings for many reasons: Well-known customer list, Long term customer loyalty, Profit margin, Reputation, Loyal long term employees, and they have participated in many of the largest and most recognizable jobs in Colorado. Their three year time weighted earnings are 490K which times a 3 times multiple comes to a sales price of 1.47M. The current sale price is well below the market at only 1.2M. This is only 2 1/2 times the trailing 12 months earnings and 2 1/4 times the time weighted earnings.

The owner and his wife started this business but they have young kids and want to spend more time with family and their entertainment business. This was for sale 9 months ago and he decided to bring in a 50% partner instead of selling 100%. The new 50% owner has decided that he wants to move to Texas to be with family and the business has been less profitable with the two of them doing a lot of the same things. They have come to an agreement as of early November 2018 to undo the partnership and undo the sale of 50% back in March as if it never happened. The original owner will offer three to five month full time paid transition with an additional 10 hours a week for an additional 3 months to help with customer relationships, bidding, sales, and programming equipment. He believes the increase in revenues this year compared to last year is based on a demand that is expected to continue in the large commercial construction market in Colorado based on the steadily increasing population, government surpluses, and the long lead time of the type of work that they do. This is unfair to the original owner because the revenues have gone from 1.65M to 1.99M since the sale but the sales price has dropped from 1.6M to 1.2M. This may change at year end as the profit margin improves again.

They have a long-standing customer base with nationally known names and have worked on some of the largest and most well-known projects in Colorado including some of the largest and most recent buildings in Cherry Creek. They do several large projects every year along with smaller ones for a solid/recurring base of customers. They have a very high percentage of recurring revenues which makes them more valuable.

They have turned down some large projects for quality of life reasons. The owners have decided to maintain a 40 hour average work week so they won’t work on 2 or more large projects at the same time, even though they have the facility and ability to do so.

You will get approximately 225K in current value Assets! This includes 155K in Equipment at their cost, 65K in Trucks and Trailers, 10K in Small Tools, and 7K in Office Equipment.

A Sales Price of 1.2M which is 2 1/2 times the earnings is a great price for a Fabrication/Manufacturing Company with everything they have going for them. The new owner has some big shoes to fill but the owner is confident that the new owner can maintain their relationships based on a strong need for their capabilities. This business will always have large projects to choose from which ties back into their strong relationships with large construction companies.

This is a “Fun” business to own that is growing and the Owners wants to make sure the new owner continues their growth and success.

The seller seeks 1M down on a total sales price of 1.2M. This is an S Corp and the Sellers prefer an Asset Sale but will consider an Stock Sale. In either scenario, the business will be offer

About the Business

Year Established:
2011
Number of Employees:
5
Real Estate:
Owned
Building Sq. Ft.:
10,000
Facilities:
Their location is on a property purchased by the owner in 2014. The property is 0.87 acres and the building is 10,000 square feet. It is located near the middle of their community and is surrounded by one of the fastest growing areas in the country. The building and property is being offered separately for 1.2M. The building has many custom improvements including a large overhead crane.
Market Outlook/
Competition:
They have a long-standing customer base with nationally known names and have worked on some of the largest and most well-known projects in Colorado including some of the largest and most recent buildings in Cherry Creek. They do several large projects every year along with smaller ones for a solid/recurring base of customers. They have a very high percentage of recurring revenues which makes them more valuable.
Growth & Expansion:
Growth Opportunities: They have 8 Main Revenue Areas: Architectural/Structural Iron, Stairs/Handrails, Pipe/Tube Bending, Ornamental/Custom Fabrication, Manufacturing, Prototyping, and Machining, which means that they are both very diversified in their products and services and are more valuable to the companies that hire them because they can fulfill multiple needs. Each of these areas can be marketed separately and together to increase future growth. They have not needed to advertise in the past based on the quality of their work and reputation.
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About the Sale

Reason For Selling:
The owners want to spend more time with their kids and other business.
Training/Support:
The owner will offer three to five month full time paid transition with an additional 10 hours a week for an additional 3 months to help with customer relationships, bidding, sales, and programming equipment.
Seller Financing:
10%

Listing Info

ID:
1569867
Ad Detail Views:
62

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Business Listed by

Jeff Chapman Eisnaugle

Business Broker Colorado
License# 100054090

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