Consistently Profitable - Stable Revenues - High Growth Opportunity
For over 30 years, this structural testing lab has been providing exceptional and trustworthy services. Its revenues and EBITDA have been consistent for past several years, with revenue of over $1M and weighted EBITDA of $560K. It offers an exceptional EBITDA margin of close to 50%.
The company serves primarily the market in Southern California and offers Non-Destructive Testing, Specialized Field Service Testing, Technical Support, and Laboratory Testing. A large part of Laboratory Testing is for FRP composite testing application, a niche testing that the lab does. About 80% of revenue is from Field services and about 20% revenue is from the Laboratory Services. Its customers are primarily Developers, Architects, Contractors, and Referring Engineers who drive work to them.
The Company typically does on an average about 100 projects in a year. It is quite selective about the projects it undertakes and as a result, it wins about 75% of the proposals it submits.
Since this Lab is considered as an essential business, its operation has not been seriously impacted during the current pandemic, although some projects have been placed on temporary precautionary hold because California has been severely hit and became a hot-spot. The business, however, is expected to return to pre-Covid level or even possibly surpass it, as delayed projects get started, probably in late 2020 or early 2021.
The Company has a staff of 9-12 people, which include an experienced operational manager, two senior engineers and 6-8 Field Technicians. Its intellectual property includes detailed templates for proposals and reports for various types of work and operations manager and senior engineers are all involved in this.
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