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Plastics Manufacturer 1205

Industry Focus Manufacturing
Region United States
Size - Revenue $26,000,000
Size - EBITDA $3,000,000

Company Overview

The founders began the Company in the 90's, providing high quality manufacturing plastics user of thermoformed for Fiber Cans, Tubes, Drums, and Similar Products consisting of high quality, heavy gage plastic. The company has the only plastics on the market with a reinforcement product. The Company products are made with a unique blend of plastic pellets that are not proprietary, but do involve trade secrets. The customers are within the transportation of container and waste industry.

In 2016, the Company yielded $23MM in revenue with Adj. EBITDA of $2.5MM. The Company is on track to achieve $25MM in revenue with $3.0MM Adj. EBITDA for 2017. In 2013 significant investment in infrastructure.

The core of the management and operational team that provides the day to day successful operation for the Company will remain after the transaction takes place with just the owner leaving as soon as practicable when the new president is up and running post closing.

The Company has developed a total portfolio of container parts and systems representing 500 different SKU’s plus assemblies to serve over 1,400 separate customers and OEM locations across the country and internationally. The broad product portfolio, national account coverage and customer service has allowed the Company to gain market share.

Transaction Overview

The waste segment is currently the largest end market for this company at approximately 70% of total revenues. The waste market is generally recession resistant as demand is driven by replacement parts for commercial market which need continued maintenance and replacement from damage and wear in the harsh field environment. The Company serves all the major waste market throughout the United States, selling product in all 50 states. The OEM market is the second largest market comprised of independent regional OEM manufacturers. The broad market coverage results in significant revenue diversity as the top five customers represents less than 45% of revenue for fiscal 2016.

Investment Highlights

The target market for this company is the waste, automotive, restaurant equipment industry.

The waste industry generates revenues estimated at $139MM and this company has captured 15% of this space. The Company believes the industry is controlled by two competitors and they are the third largest company in this industry. The balance of their competitors are Mom and Pop businesses. The Company believes that potential customers total 15,000 companies and they sell their product to 9% of those companies.

The Company does not utilize outside independent Reps but calls directly on all accounts. They utilize distribution in Canada and now on the west coast to provide more consistent market coverage. The Company has established a very good customer service reputation in the industry and believes that direct interaction with the customer is critical.

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