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Annual turnover

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  • Mandate: 34081
  • Added: 25 Jun 2020
  • AFS
  • 286

Engineering Business with large Blue Chip client that has been established for 33 years

Gauteng, Johannesburg
286
Mandate 34081
Added 25 Jun 2020
R 4,995,000* ZAR
Stock: R 600,000
Assets: R 2,000,000
R 168,752 ZAR
Andre Botha
(PRINCIPAL)
Aldes Pro
Gauteng
Summary

Engineering Business, offering various services such as CNC Plasma cutting, CNC Bending, CNC Punching and many more. It has also recently started with the manufacturing and distributing of Sanitizer stands. The building housing the business can also be purchased separately.

Engineering Business with large Blue Chip client that has been established for 33 years
SELLING PRICE AFS
R 4,995,000* ZAR
Stock: R600,000
Assets: R2,000,000
R 168,752 ZAR
Summary

Engineering Business, offering various services such as CNC Plasma cutting, CNC Bending, CNC Punching and many more. It has also recently started with the manufacturing and distributing of Sanitizer stands. The building housing the business can also be purchased separately.

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Fully describe the business's activities?
As a Privately owned Business this company offers a wide range of services to various Industries. They are a leading structural steel fabricator and erector, they also conduct work throughout Sub-Saharan Africa. Their combined service offering ensures an all compassing experience to our customers, from design to delivery, we ensure our customers demands and challenging engineering and steel fabrication requirements are met. The focus on our customer commitment, service offering excellence and a believe in our values and mission ensures that every piece of equipment that leaves our workshop has the required craftsmanship and skill applied to.

How long has the business been established?
Since 1987

How long has the owner had the business?
Since 2016

What steps are in place to solve 'load shedding' problems?
The operation has a 80 KVA, 250 AMP generator on site which is owned by the business

What is the average KW usage?
80 KVA, 250 AMP

How does the business operate on a daily basis?
Besides doing work for a large blue chip company, the business has during lockdown designed a Hands free Chemical dispenser which it is marketing successfully and view this as a huge expansion opportunity in future.

What Advertising/Marketing is carried out?
Website and facebook. Advertising has been increased recently for promoting NEW SANITIZER STANDS manufactured by the business.

Does the business have any contract work?
No specific contract but does much work for a large blue chip company and has been doing so for many years now.

How did the Covid-19 pandemic impact the business turnover / daily operations?
The business was closed for the whole of April and slowly started trading in May again. During this period and whilst some of its customers were closed it had designed related products which it is distributing widely now. The order book for June and July looks extremely positive. Projections are that they should be back on track within the next month or two with full order books.

What steps / actions have been taken to combat the effect of Covid-19 pandemic?
The business aims to diversify as much as possible inf future with new designs in the pipeline for Industries like the Agricultural sector as well.

Is the business VAT Registered?
Yes

What VAT documentation is on file?
up to end of February 2020

Are there up-to-date Management Accounts available?
Yes

What Balance Sheet and Income Statements are available?
2020 in progress

What percentage of the business is cash/credit?
Mostly credit but some cash on scrap metal.

What is the age analysis of the debtors book?
30 days

Is Seller finance available and for what amount?
No

What is the total staff complement?
A Team of 22

Give a breakdown of staff/ functions/ length of service?
Current Personnel: • 1 x Owner • 1 x Site Manager/Workshop Production Manager – Critical Employee o 4 Years with company • 1 x Bookkeeper (owners wife) • 1 x Internal Sales (Temporary) • 1 x Admin/Key Accounts manager – Critical Employee o 12 Years with company • 1 x Workshop Production Manager – Critical Employee o In Process of employing a new production Manager • 1 x Draughtsman – Critical Employee o 2 Years with company • 4 x Boilermakers (2 x Contract/ Temporary) • 1 x Semi-Skilled Boilermaker • 1 x Welder • 1 x Plasma Machine operator/ Forklift Driver • 1 x Punching Machine Operator / General worker • 1 x Driver / General Worker • 1 x Painter • 1 x Cleaner/Fettler (Contract) • 3 x General worker / Site workers (1 x Contract) • 1 x Domestic Cleaner (2 x week)

Do any receive special perks or incentives?
Yes. TBA

Are they on contract?
Most of the critical team are permanent with a few non-critical on short term contracts.

Do any have management potential?
Yes

How involved is the Owner in running the business?
Daily

Any special arrangements for the staff related to the Covid-19 pandemic?
The business does comply to legislation in this regard.

When does the current lease end?
The seller is the owner of the building which can be purchased as well at a price of R6m. The building is situated on a 2000sqm site and comprises of ; • Fully enclosed with wall Workshop: 1200m2 • 1 x 5 Ton Crane • 80 Kva Generator • 2 x lockable tool rooms • Staff Ablutions (Part of workshop on Mezzanine) Offices: 200m2 • Reception area • 4 x offices • 1 x kitchen • 4 x office toilets • Archive Room Should a buyer decide to rather rent and not purchase the building, this will be at a price of R49k per month.

What is the square meters of the business?
1400sqm building on a 2000sqm site

What lease deposit and/or other surety is required?
2 Months

What are the main assets of the business?
Machinery Vehicles Software and many more.

Are any items not included in the sale?
All items are included

What is their overall condition?
Very good

How have they been valued ?
By the owner

Which assets are on lease/HP and with whom?
Machinery/Vehicles on Lease: 1. Amada CNC turret Punch a. R14 637.59 per month – 2 Years & 6 months left 2. Opel Corsa Utility Bakkie a. R2 522.25 per month – 4 Years & 10 Months left 3. Mitsubishi Utility Bakkie a. R1 188.57 per month – 3 Years & 8 months left

What are their settlement amounts?
as above

Will Seller settle or Buyer to take over?
The buyer will take over the existing leases.

Are copies of agreements available?
Yes

Are they presently insured?
Yes

Strengths?
Quality of staff In existence for many years. Easy to adapt to new projects Loyal support from a large blue chip company.

Weaknesses?
None perceived

Opportunities?
Developing new products and new markets

Threats?
None perceived

What is the reason for the sale?
The seller will be moving to another province to join the rest of the family on a family farm.

Why is this a good business?
I personally believe that the business is a good business because of its reputation for good quality workmanship and good pricing. The fact that the business is still going after 32 years is testimony to this. Another key aspect is the fact that we have long standing return customers which we have been dealing with for 10+ years. We are also the only company in SA who is doing some specific work for a Blue chip co. across their factories in South Africa and possibly Ethiopia. The company (and its employees) holds the intellectual property and the equipment. We also have a retired site supervisor who works on contract bases from time to time who sits with this intellectual property. He cannot go to another company as he signed a restraint of trade regarding this. Although we are predominantly a project-based company, we have about 30% of our customers which we do repetitive work for. This is significantly higher from previous years as the current owner’s focus was to increase this type of work. The business is also in the process of design and manufacture of its own agricultural products which means that in the quite periods, the staff can be kept busy with cash generating work. The company also developed 3 different sanitizer dispenser units. A standard foot operated unit, A primary school foot operated unit and a “stainless steel wall mount” unit. Although the demand for these products are declining, the company has found other avenues to sell: E.g. Cross border, Takealot, Amazon UK which we believe will increase the sustainability of the products. We are also holders of an export license which is ideal to increase the company’s footprint in SADC countries.

What is the price plus stock and the profit?
Price of the business is R4,995m inclusive of stock. Creditors / debtors will be discussed separately. The Building consisting of the following; Yard: 2000 m2 • Fully enclosed with wall Workshop: 1200m2 • 1 x 5 Ton Crane • 80 Kva Generator • 2 x lockable tool rooms • Staff Ablutions (Part of workshop on Mezzanine) Offices: 200m2 • Reception area • 4 x offices • 1 x kitchen • 4 x office toilets • Archive Room can also be purchased for an amount of R6m.

FRANCHISE DETAILS

Aldes Pro

3 members
32 active mandates
Gauteng
Malcolm Road
0000

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