|
|
|
|
This thirty-year-old machining business has a stellar reputation across North America. The Company is a UL Registered Firm and is certified ISO9001:2000. The Company grew steadily during its first two decades and very rapidly during the 1990’s. The Company suffered huge setbacks in the late 1990’s and early 2000’s due to the death of its President and the worldwide recession and consolidation of the steel industry during the same period.
At the height of its success in 1998, the Company had gross revenue of $21 million dollars and earned profits of $6.8 million dollars. Business fell dramatically as the steel and auto parts industries consolidated. The Company has been in a turnaround cycle during the last number of years. Sales in fiscal 2005 were $6.8 million dollars.
The Company is well into its turnaround. For the year ending September 30, 2006, the Company is projecting revenue of $9 million and normalized EBITDA of $750,000. The Company is being led by a small and knowledgeable team of managers. They have transformed the business from a large design build Company to a specialty machine shop that is providing services across a variety of industries including energy, automotive, steel and resources. A significant amount of the business is done in the United States and the Company has become very efficient since it no longer enjoys the luxury of significant gains from foreign exchange.
The business model is now focused on selling out available labor hours while it still has about 20% of its workforce dedicated to custom build. The Company earns little, if any, margin on material used in the jobs and in many cases now contracts with customers to provide the product to be machined.
The death of the President along with the recession in the steel industry prompted the Company’s bankers to withdraw their support. The sole shareholder, the President’s wife, has financed the business through the turnaround. The Company’s forecasts beyond 2006 are dependant on the acquisition of two new pieces of equipment that will enhance productivity. Each piece of equipment will cost about $2 million dollars installed. The Company does not have the financial strength to purchase or lease the equipment and the shareholder does not wish to finance the growth. She has determined that now is the time to sell the Company.
Projected Operating Results CAN $(000)
Years ending September 30
2006 Revenue $9.1MM; Normalized EBITDA $752K
2007 Revenue $16.3MM; Normalized EBITDA $2.3MM
2008 Revenue $18.2MM; Normalized EBITDA $2.9MM (ON HOLD)
For Further Information Contact:
Larry Maker
Lexbridge International Mergers & Acquisitions Group
Two St. Clair Avenue East, Suite 1100
Toronto, Ontario M4T 2T5 CANADA
Tel: 416-963-7216
Fax: 416-964-6454
INQUIRE FURTHER
or
For Further Information Contact:
Burton Bartzoff
BKR International Mergers & Acquisitions Group, LLC
40 Mall Road, Suite 206, Burlington, MA 01803
Tel: 781-221-8421
Fax: 781-221-3533
INQUIRE FURTHER
|
|
| |
| |
|
