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Below Ground Sampling & Testing

Soil, water, and well for environmental services!

CASH FLOW
$375,167

Specifications

  • Price
    $1,475,000

  • Revenue
    $1,169,620

  • Profit Margin
    32%

  • Location
    Chicagoland

  • Employees
    7: 5 FT, 1 PT, 1 FT 1099

  • Reason for Sale
    Retirement

  • Equipment
    $651,000: Specialty drilling equipment, geoprobe tools, 7 trucks, 5 trailers

  • Lease
    3,000 sq. ft.: 60x70 steel frame building with office & shop, 3 overhead doors with indoor parking

  • Service Area
    Work is mainly completed in Illinois and Indiana

Environmental services in groundwater, soil, soil vapor, well installation and abandonment! Principally located in the Chicagoland area, this professional environmental drilling company has been providing expert soil and water evaluation services since 1996.  The owner spends less than 15% of his time in the field and this can be easily absorbed by current employees. They have completed projects in 27 states, but typically focus their efforts on acquiring work in the Heartland, specifically Illinois and Indiana.  The team of seven offers services that include testing for groundwater, soil, soil vapor, well installation & abandonment.  When an environmental consultant needs subsurface samples, this team drives to the site (7 trucks & 5 trailers included), drills the sample, and provides a workspace for an outside consultant to do their testing.  The $256,561 worth of equipment such as specialty drilling rigs, and geoprobe tools are included in the asking price with on the shelf well materials, supplies, and fuel to be added. 

 

Currently, this company does not do any in-house sample testing, they simply collect the sample and provide it to the environmental consultant.  Adding an analyst, however, is an area for growth that could potentially bring in additional projects.  Additional areas of growth can be found in geotechnical drilling as well as maximizing utilization and assets, so there is great potential for growth without increasing overhead.

 

The business operates from a 3,000 square foot space within a steel frame building perfectly suited to the company with room for expansion.  With two offices, a very large shop, and three overhead doors, there is plenty of workspace and storage, as well as room for indoor parking. 

Business Highlights

  • Year Established: 1996
  • Headquarters:  Chicagoland, with satellite in Cincinnai
  • Service Area:  Work is mostly completed in Illinois and Indiana
  • Clients: Environmental consultants, commercial property owners, realtors and bankers
  • Services: Subsurface sampling for environmental testing: groundwater, soil, soil vapor, well installation and abandonment
  • Building: 3,000 sq. ft.: Steel frame building with office & shop, 3 overhead doors with indoor parking
  • Reason for Selling: Retirement
  • Employees: 7:  5 FT, 1 PT, 1 FT 1099
  • Seller Training Period: 1 year
  • Growth Opportunities: Build in-house analytics, maximize utilization, add geotechnical services, quarterly ground water monitoring, NPDES sampling
  • Current Owner’s Responsibilities: Owner spends less than 15% of his time in the field- this can be easily absorbed

Financial Highlights

  • List Price: $1,475,000
  • Gross Sales:
    • 2019: $1,169,620
    • 2018: $1,094,010
  • Cash Flow:
    • 2019: $375,167
    • 2018: $241,173
  • Assets Included in Purchase: $256,561
  • Equipment and Expendables: Specialty drilling equipment, geoprobe tools
  • Vehicles: 7 trucks, 5 trailers
  • Secured Work:  This business books out projects 1-3 weeks in advance.
  • Intangible Assets: Positive word-of-mouth referrals, long-term clients, diverse client base, diverse project sizes, substantial history of successful operations

*amounts may vary

Cash Flow Analysis

Description of Financial StatementP&L StatementTax ReturnTax ReturnNotes
202020192018
GROSS SALES$821,337$1,169,620$1,094,010
Net Income Shown on Financial Statement$145,652$178,871$32,471
ADDBACKS
Compensation to Owner with Tax$44,473$46,584$41,070
Depreciation$12,321$37,886$98,318
Interest$13,691$20,881$18,645
Meals & Entertainment & Travel$384$18,506$18,571Personal expense
Contributions/Donations and Gifts$200$150$4,804Non-onward going expense
Health and Life Insurance$26,337$33,231$29,863Personal expense
Cell Phone$659$3,589$2,245Personal expense
Vehicle/Auto, Fuel, Insurance$10,719$19,291$20,737Personal expense
Condo$8,348$14,395$4,644Personal expense
Retirement Contribution$0$1,110$1,110Paid to owner
Rent to Owner$26,337$29,771$38,695Personal expense
GM to Replace$-46,666$-70,000$-70,000
Building Repairs$1,353$4,313$0
Dues$0$715$0
Home Office $366$13,396$0
Back Returns $0$6,061$0
2019 Buildout $185$12,478$0
Generator for Truck $0$3,952$0
Engine in Geoprobes $10,000$0$0
TOTAL ADDBACKS$108,707$196,309$208,702
Seller's Cash Flow = Total Addbacks + Net Income$254,359$375,180$241,173
Profit Margin30.97 %32.08 %22.03 %
  • 32% profit margin in 2019

Typical Clients and Services

Clients:

  • Environmental consultants
  • Commercial property owners

     

Services

  • Subsurface sampling for environmental testing
    • Groundwater
    • Soil
    • Soil vapor
  • Shallow and small diameter monitoring well installation and abandonment services

Specific information regarding clients is available upon the receipt of a signed Non-Disclosure Agreement.

Employees

Total Employees: 7

  • 5 Full-time
    • Operators
    • Maintenance
    • Bidding
    • HR
    • Marketing
  • 1 - FT 1099 Contractor
    • Operators
    • Maintenance
    • Bidding
    • HR
    • Marketing
  • 1 Part-time
    • Bookkeeping
    • As needed assistance

Growth Opportunities

  • Build in-house analytics in full revenue stream
  • Maximize utilization without additional overhead
  • Add geotechnical testing
  • Expand current marketing efforts
  • Include private utility locating services
  • Add NPDES sampling
  • Institute quarterly monitoring services for ground water sampling
  • Expand to remediation system operation and maintenance services as well as earth work services for small remediation jobs

Funding Example

Purchase Price:                             $1,475,000

12.5%Buyer Down Payment:      $184,375

12.5%Seller Financing:               $184,375

75%Bank Loan:                         $1,106,250

Seller financing 6-year term at a rate of 6% equals a monthly loan payment of $3,479.

Bank loan 10-year term at a rate of 6% equals a monthly loan payment of $12,421.

After business expenses and loan payments, a buyer with a 12.5% down payment of $184,375 would retain a profit of $166,352, which results in a 90% return on investment in the first year.

A lender is required to have a minimum 1.25 coverage ratio for any business loans extended. At a proposed purchase price of $1,470,000 with the terms listed above, the coverage ratio is 1.87. 

Please note that the decision of whether to extend a loan on any sale belongs to the bank, and this document does not guarantee specific terms or verify that financing is available. 

Purchase Price:

$1,475,000

$
%
OR
$
%
OR
$
Years
%

Bank Loan Needed: $

Years
%
$
$
$
$
$

Funding Details

Business:

Offer Price: $

% Buyer Cash Down at Closing: $

% Seller Carry Back via Promissory Note: $

year term at a rate of %

% of Purchase Price secured by Buyer and Seller

Total Bank Loan Need: $

% of Purchase Price

Desired Loan Type:

Desired Bank Terms: year term at a rate of %

Total Business Assets, Inventory, and A/R: $

Total Undercollateralized Loan: $

Loan Payments

Monthly Payment to Bank: $
Yearly Payment to Bank: $
Monthly Payment to Seller: $
Yearly Payment to Seller: $
Total Monthly Debt Service: $
Total Yearly Debt Service: $

Conclusions

Fixed Charge Coverage Ratio

The bank will require a minimum ratio of 1.5 to be lendable.

Cash Flow:
2 year avg Cash Flow
$
Annual Debt Service: $
RATIO:

Buyer's Net Operating Income (NOI)

The amount of money the Buyer will retain as profit.

Cash Flow:
2 year avg Cash Flow
$
Annual Debt Service: -$
NOI:

Buyer's Return on Investment (ROI)

The rate of return on the Buyer's down payment.

Down Payment: $
NOI:
ROI: %

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210 N 78th St. 2nd Floor
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The Firm is not a real estate brokerage and therefore the staff will not handle any aspect of the lease, sale or purchase of real estate.