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:
$2,058,000
Cash Flow:
$499,000
EBITDA:
$499,000
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.

It is priced at only $1.2M. I received a $1.6M offer on this same business last year and the revenues are up over 20% this year compared to last year with higher earnings also. The earnings would have been even higher this year except for 2 reasons which are both one-time events(tariffs which are now dealt with in his contracts and the partnership that he choose to dissolve). The business is now being offered at only 1.2M which is 400K below the price it was last year and it has better revenues and adjusted earnings now. Part of the reason is that I priced this in October when his year to date numbers were not as good as they are now. The recent improvement is because he is back in charge of production as of Oct 1 2018 and the numbers are returning to normal.

This company had 15 employees in 2016 and can again. The only reason this company is the size it is and not much bigger is because the owner doesn’t want to work that hard and turns down work every week. The only reason that this isn’t priced at $2M or higher based on larger numbers is why he called me to begin with. Quality of life, family, etc. are more important to him than working more than 40 hours a week. The owner will offer a full time transition and then stay part time afterward to help as needed. It is rare to find a company with literally zero advertising budget that turns down work that they have the capacity to do.

The 2018 Year to Date revenues through December 18th, 2018 were 2,058,362 with 499K 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. The current sale price is below the market at only 1.2M. This is only 2.4 times the trailing 12 months adjusted earnings. This company deserves a 3 times or higher multiple.

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 10 months ago and he decided to bring in a 50% partner instead of selling 100%. The owner was not happy with the partnership and the new 50% owner decided that he wanted to move to Texas to be with family. The original owner will offer three month full time paid transition with an additional 10 to 20 hours a week for an additional 9 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.

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

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 project

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:
65

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Business Listed by

Jeff Chapman Eisnaugle

Business Broker Colorado
License# 100054090

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