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Specialist Manufacturer of Ancillary Equipment for the Packaging Industry

Ref. IV030

Location : Hampshire

Asking Price : £1,200,000

Turnover : £1,525,000

Net Profit : £307,000

Gross Profit : £606,000

EBITDA : Undeclared

Net Asset : £530,000

Premises : Freehold

Confidentially offered for sale


  • Turner Butler

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Premises: Freehold

Asking price: £1.2M + Net Assets

Business highlights include:

Turnover circa £1,525,000 per annum
Adjusted Net Profit circa £307,000 per annum
Gross Profit circa £606,000 per annum
Net Assets circa £530,000 (2015 accounts)
Proprietary Intellectual Property
Comprehensive website
Fixtures & fittings
Skilled & motivated personnel
Two modern & comprehensive factory units
Significant Goodwill

Business Profile

Set up almost 18 years ago this well established and reputable business provides a comprehensive range of niche products and services to a variety of clients in the packaging and manufacturing sector, with an international customer base.

The company specialises in the design, manufacture and assembly of quality products that have high value added content. Components are manufactured from steel, aluminium, carbon fibre and possess its own extrusion dies and tooling. The company has the facility to supply both large and small parts together with large or small batches.

The business has been developed over time with significant re-investment in the company, including tooling, equipment and its premises. The company can boast a substantial level of modern automated plant and machinery including latest state of the art CNC machining centres and office systems.

The business has its own internal inspection procedures to ensure customers receive only the highest quality products and services. This internal capability enables the business to take on varied and challenging high profile projects for blue chip end users.

The business has designed and developed many products that are the results of solving complex technical problems for its customers and retains significant intellectual property assets. The business also benefits from having a significant spare part and service facility.

From first contact to completion the onus is geared towards complete customer satisfaction.
The business is committed to ensuring manufacture is to the required standards of excellence, as you would expect from a company with such infrastructure.

The current split of customer base is with 50% OEM clients and 50% end users. New equipment represents 85% of turnover with the remainder made up with spare parts, repairs and servicing, and commands some of the highest profit margins.

Equipment/Capacity:

The company has a comprehensive catalogue of modern CNC machines, automated plant and secondary operations. A full listing is available and includes state of the art CNC Turning Centres, CNC Milling/Machining Centres.

In addition to this the business has a range of both large and small conventional plant including lathes, mills and drills to complement its impressive capacity.

The business operates from two units on the same modern industrial park and manufactures in one and manages assembly, and stock management in the second. The business maintains stock for standard products and common parts, which help to increase profitably and ensure urgent deliveries, and spare part availability.

Customer Service:

This is a key area of strength for this business. The company is a quality driven organisation and has never failed to successfully meet a customer’s requirements.

The company has a full management team taking care of day to day customer relations; this together with speed of response and consistent quality of product ensures significant levels of repeat business. New business creation is achieved through the internet with some keywords ranked number one on Google and other search engines. Client testimonials and word of mouth within the market also accounts for a constant stream of new business.

Key Strengths:

The company is financially strong with a very good asset base and operates from ideal Freehold premises. The company is benefitting from on-going investment. It is growing year on year in terms of customers and financial performance and it consistently generates impressive profits.

The business is a multi-skilled operation that can undertake a large variety of projects due to the impressive infrastructure it has in place. Both large and small component quantities can be produced side by side. The internal skills are high and the company’s reputation is very strong.

The business is established and profitable with a broad and diverse client base and has regular customers with the largest single customer accounting for just 6% of turnover. The business retains a high level of historical clients. It has superb internal quality systems and an excellent health and safety record.

The company has earned an outstanding reputation for its honesty, integrity, technical ability, service and reliability.

Key Opportunities:

This is an outstanding opportunity to build on the existing products, services and customer base of this leading company. With a strong demand and impressive profitability, combined with a capacity to increase turnover, a new owner contributing fresh ideas and energy levels will have every advantage of building on an excellent platform to take this business to its next level.

The business maintains hundreds of satisfied customers, who appreciate the company s superior products and skill sets, attention to detail, value for money and service.

There are many excellent avenues for growth, especially within the current operations capacity. A dedicated sales and marketing effort would yield significant levels of additional business and profitability as, by its own admission, the business tends to be reactive rather than proactive in its approach to sales and marketing, as it has no formal sales team.

Financial Information:

The business is being offered for sale on a going concern basis, all financial discussions will take place directly between the vendor and all interested parties under the auspices of Turner Butler.

Turnover circa £1,525,000 per annum
Adjusted Net Profit circa £307,000 per annum
Gross Profit circa £606,000 per annum
Net Assets circa £530,000 (2015 accounts)

The Asking Price is for 100% of the issued capital of the company based on Net Assets being circa £530,000. There will be a £ for £ adjustment to the asking price to reflect any rise or fall in this net asset position as at completion.

The business has a clean bill of health with no loans or HP outstanding. We are advised that the freeholds can be available.

Asking Price:

The asking price of £1,200,000 plus net assets for 100% of the ownership of the business on completion (calculated on a zero cash-zero debt basis).

The owners are planning their exit strategy due to pending retirement.

Advertising and Marketing:

The business could benefit from a more strategic internal medium/long term sales and marketing planning. It has a basic yet informative website but does very little in the way of proactive marketing. In saying that the website ranks number one on Google for explicit searches for the specialised products that the company manufactures.

Growth and Expansion:

The business is well positioned to take maximum advantage of growth markets as they occur such is its ability to provide a diverse range of products and services in house with quick turnarounds. It has the infrastructure already in place to cater for significantly more work whether large or small scale.

It also has the ability to enter new markets should a new owner so wish as it has a sterling reputation in place. It is already seeing growth in terms of new enquiries as its proprietary designs and products consistently find new customers around the world.

The business currently operates a one shift pattern. There is no reason why this cannot be expanded should a new owner look to put more resource in place.

The company has relationships with UK and overseas agents, with a little more effort this could be increased and it is believed would yield excellent results.

Premises:

The business operates from fully equipped freehold premises that are located on a modern, well-known business park, near a busy south coast industrial city. The premises are circa 2,500 square feet per unit, ground floor area and in combination with the mezzanine areas in both units, the total floor area is circa 8,000 square feet.

Unit 1 comprises ground floor workshop/production areas, kitchen, toilets and delivery area with roller shutter and offices on the mezzanine.

Unit 2 is similar but with assembly on the ground floor and storage on the mezzanine.

The premise offer excellent value for money and are located in a fabulous semi rural location, very close and in easy access of A roads and nearby motorway. We are advised rent, rates and water are circa £24,000 p.a. per unit.

Business Hours:

The business currently operates on a one shift system, Monday to Friday. This could be expanded if need be.

Employees:

The 2 directors/vendors work in the business on a day to day basis. Both directors are hands on with one responsible for engineering and the other for sales, both have been coaching the management team with the result that this team has been taking more and more of these duties on as time has progressed.

As well as the directors, the business also employs:

4 x Managers / supervisors
5 x Design engineers / administration / accounts
8 x Skilled Precision Engineers / Apprentices
7 x Assembly/fitting shop personnel

Support and Training:

The current owners would be happy to provide full training and support at handover to ensure a seamless transistion of ownership. One/both may be prepared to stay on within the business for a further period of time should a new owner so require, subject to negotiation.

Reason for Sale:

The owners are planning their exit strategy due to pending retirement.

Looking for finance ?

If you are looking for finance to fund your business purchase then we recommend that you talk with our independent finance broker. Because of his many years working at a senior level for a major high street bank he has had more success with finance applications than anyone else we know. He has helped numerous purchasers of businesses that we are selling, including buyers who have been turned down by their own bank! Call us today on 0800 046 1652 or email us at finance@turnerbutler.co.uk

Turner Butler Disclosure Statement

This statement applies to information relating to any company or other undertaking or business advertised for sale by Turner Butler (a 'Business')

The information supplied by Turner Butler on its website or in any other promotional material ('the Information') is not and is not intended to constitute an offer for sale of the Business or any assets of the Business or of the shares of any company which owns the Business.

For the avoidance of doubt there is no intention to create a legal relationship which will only come into existence when a written contract for sale and purchase of the shares in or the Business has been entered into

The Information provided is not intended to address your particular requirements. Further the Information does not constitute any form of advice recommendation representation endorsement or arrangement by Turner Butler and is not intended to be relied upon in making (or refraining from making) any specific decisions.

Any agreements transactions or other arrangements made between you and any client of Turner Butler are at your sole risk and responsibility. The prospective sellers of the Business have provided the Information to Turner Butler. The Information has not been verified by Turner Butler.

You must carry out your own due diligence and satisfy yourself as to the accuracy of all matters. In the case of the sale of shares in a Business the Information has been prepared on the basis that the shares will consist of or include more than 50% of the voting shares and that both the seller and the buyer is either a body corporate, a partnership, a single individual or a group of connected individuals so as to fall outside the scope of regulated activities as defined by the Financial Services and Markets Act 2000. If you are considering a transaction which falls within the scope of such regulated activities you cannot do so through Turner Butler.

Appropriate professional, legal and accountancy advice should be obtained before making or refraining to make any decision.

Turner Butler does not accept any responsibility or liability for loss or damage of any nature that may occur by reliance on the Information. Neither Turner Butler nor any of our employees or agents makes any representation as to the completeness or accuracy of the Information nor do we accept any liability for any losses, costs, liabilities or expenses which may arise directly or indirectly from your use of, or reliance on the Information.

This document is governed by and shall be construed in accordance with English Law and any dispute arising in connection with it shall be subject to the non-exclusive jurisdiction of the English courts

Turner Butler
Ickenham House, 2-4 High Road, Ickenham, Middlesex, UB10 8LJ
Telephone 01895 25 6000 Facsimile 01895 25 7777
info@turnerbutler.co.uk
www.turnerbutler.co.uk