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May 2, 2019 — This company provides a variety of oil well services including general well maintenance/work overs (historically 70-80%), completions, re completions, hotshot service, and plug and abandoning services (20-30%). Since inception, the company was built around an understanding of market fluctuations and so they designed their business to be sustainable despite challenges in the industry. The company has concentrated on maintaining low customer concentration, oil well maintenance (which is less susceptible to changes in low oil prices), and superior service.
Their growth trajectory over the course of the last three years has been impressive. In 2016 they generated $1.7M in revenue. They grew to $7.1M the following year and reached $13.3M in 2018 and as of February 2019 a TTM of $14.6M. As for 2019 and beyond, management has laid out a plan to double their revenue in the next 2 years. The owners are reaching their financial and managerial capacity and they would like to see their creation continue to reach its full potential and execute on their plan for continued growth before they retire.
The company has a strong backlog of work requests, but they aren’t able to accommodate all of those due to a lack of equipment necessary to carry out the work.
There are over 20,000 oil wells in the Bakken with projections to have over 40,000 in the next couple of decades. Like an automobile, they will all need maintenance at some point and that is the niche where this company has established their brand.
With a solid core of employees in place and a reputation built on quality and “doing it right the first time,” the right buyer will be able to take the company to its destined success. The potential purchaser is likely an organization with sufficient access to capital and the ability to adapt larger company systems into the growing company. Strategic companies in the area looking to expand their operations, complementary oil well service companies, oil well service companies looking to expand into the Bakken Region, and private equity groups looking for a good return on their investment are just some of the good potential fits for future ownership of this company.