Corporate Mine Safety Instruction
This is a growing and dynamic miner safety business for sale. Located near leading gold mining companies in a leading gold mining state, this operation has the best interests of their customers at heart. Providing comprehensive services for miners gives this business an advantage over their very few competitors. With the addition of staff, the growth potential for this business is great.
Services include surface and underground miner safety classes, respirator and spirometer fit testing, audiometric testing, as well as first aid and CPR instruction. Mine related services account for 90% of overall income. With a focus on ease, convenience, and miner needs, 75% of business is from returning loyal customers.
Classes are offered in 12 hour shifts to accommodate the typical mining schedule. Around 40% of students have testing done while in class. This company also accommodates group instruction and testing by contract with large mining corporations.
Instructors of the mine safety classes must be a current or former miner. The current owners are also sole operators, with the exception of 2 part-time staff brought on for large contract work. The owners’ responsibilities can be assumed by a qualified teaching candidate and an administrative hire. Owner 1 is an instructor and owner 2 handles all administrative tasks as well as industrial hygiene testing. All curriculum is in place for the new buyer.
- Year Established: 1996
- Location and Service Area: In a leading gold mining state serving local and international clients
- Clients: Miners, those working on mining sites, mining companies
- Services: New miner training, OSHA classes, industrial hygiene testing (spirometer and respirator)
- Building: 3,800 sq. ft.
- Reason for Selling: Focus on family
- Employees: 4: Owners (2) are operators, but all duties can be taken over by additional qualified staff, 2 part-time teachers for large contract work
- Seller Training Period: 90 days transition
- Growth Opportunities: Add staff to increase capacity, increase hours of operation, expand OSHA classes, expand safety consulting services, seek out additional annual contracts from local large mines
- Current Owner’s Responsibilities: Owners are operators, but all duties can be taken over by additional qualified staff
- List Price: $345,000
- Gross Sales:
- 2017: $286,764
- 2016: $215,849
- 2015: $226,149
- 2014: $171,438
- Cash Flow:
- 2017: $99,233
- 2016: $71,741
- 2015: $97,561
- 2014: $61,148
- Assets Included in Purchase*
- Intangible Assets: Long-standing community business, positive reputation, comprehensive approach, family atmosphere, returning clients
*amounts may vary
|Description of Financial Statement||Tax Return||Tax Return||Tax Return||Tax Return||Notes|
|Net Income Shown on Financial Statement||$21,485||$26,025||$18,709||$-5,480|
|Compensation to Owner||$24,000||$31,200||$31,200||$31,200||Owner 1|
|11% Tax on total W2 Salaries||$2,640||$3,432||$3,432||$3,432|
|Meals & Entertainment||$1,931||$1,996||$1,670||$700|
|Auto-Personal Use||$1,681||$849||$306||$0||10% personal|
|Seller's Cash Flow = Total Addbacks + Net Income||$99,233||$71,741||$97,561||$61,148|
|Profit Margin||34.60 %||33.24 %||43.14 %||35.67 %|
- Individual miners
- Those that work on mining sites
- Drillers that work on mine
- Mining corporations
Specific information regarding clients is available upon the receipt of a signed Non-Disclosure Agreement.
- New miner surface training
- New miner underground training
- Surface and underground refresher courses
- OSHA courses
- Respirator fit testing
- Spirometer fir testing
- Audiometric fit testing
- CPR/First Aid/AED
- Owners are operators
- Owner 1: Miner class instructor
- Owner 2: Administrative duties and testing
- Part-time employees (2)
- These individuals are brought on as instructors for large contracted instruction and testing work
- Add staff to increase capacity
- Increase hours of operation
- Expand OSHA classes
- Expand safety consulting services
- Seek out additional annual contracts from local large mines
There is ample customer demand for services. This company could experience significant growth if additional staff were hired and services were expanded. This can be done in the current facility without additional modifications.
The Firm Business Brokerage used a Cash Flow Valuation methodology to determine the Purchase Price of the business.
The formula used is as follows:
Cash Flow x Prescribed Multiple = Fair Market Value
Cash Flow is the sum of business net income plus any owner perks and any non-onward going expenses.
A multiple is prescribed by a 20 question, 100-point parameter ranking system that is used to analyze the current business health. Each question is based on a scale from 1 to 5: 1 being low, 2 below average, 3 average, 4 above average, 5 high. The average of the responses sum is the business’ prescribed multiple.
For this business, a 2017 Cash Flow was used with a prescribed multiple is 3.35. With this information, the computation is as follows:
$99,233 x 3.48 = $345,331
The Fair Market Value found above positions the business List Price at $345,000.
Purchase Price: $345,000
10% Buyer Down Payment: $34,500
10% Seller Financing: $34,500
80% Bank Loan: $276,000
Seller Financing 5-year term at a rate of 4.50% equals a monthly loan payment of $643.
Bank Loan 7-year term at a rate of 6% equals a monthly loan payment of $4,032.
After business expenses and loan payments, a buyer with a 10% down payment of $34,500 would retain a profit of $43,131, which results in a 125% return on investment in the first year.
A lender is required to have a minimum 1.5 coverage ratio for any business loans extended. At a proposed Purchase Price of $345,000 with the terms listed above, the coverage ratio is 1.77.
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.
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: $
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|Yearly Payment to Bank:||$|
|Monthly Payment to Seller:||$|
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|Total Monthly Debt Service:||$|
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Fixed Charge Coverage Ratio
The bank will require a minimum ratio of 1.5 to be lendable.
2017 Cash Flow
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Buyer's Net Operating Income (NOI)
The amount of money the Buyer will retain as profit.
2017 Cash Flow
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Buyer's Return on Investment (ROI)
The rate of return on the Buyer's down payment.
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Omaha, NE 68114
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