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Title: Leading Design Agency - Under Full Management
ID Number: 9532
State: ACT (ACT)
Categories: Professional - Computer/IT
Description: Acquisition: Leading Design Agency UNDER FULL MANAGEMENT ($2.8M, 32% ROIC)

The Company is a leading design agency based in the Australian Capital Territory (ACT). It boasts industry leading metrics and a balanced portfolio of clients. The Company's service mix is balanced across print, identity constructs with significant growth in new media.

After a successful 14 year history, the Company is being offered for sale.

The owners are passionate about their business and would be pleased to work within the business for the new owner for several years. Alternatively, the Company has been structured so that it can be effectively operated under management.

The acquisition offers exceptional value to investors and would suit:
* Migrants: seeking a high quality business that is effectively operated under management
* Investors: seeking exceptional ROI generated from low asset base with no debt
* Industry participants: seeking to acquire a diversified blue-chip client base, exceptional long-term relationships, balanced capabilities across various segments, and a creative and empowered workforce
* Printers: seeking to acquire substantial print revenues at high margin with associated high value design services

Exceptional Investment
* Successfully established for 14 years
* Ability to operate under management with current owners and/or budget included for full-time Operations Manager
* 32% anticipated return on total invested capital (including working capital)
* Strong working capital position anticipated at time of sale
* Industry growth forecast 2011-2016: 4.7% p.a (IBISWorld Industry Report L7852: Graphic Design Services)
* Relatively low industry regulation

Industry Leading Performance
* 4 year average normalised EBIT $885,438 (includes budget for Operations Manager)
* Maintained strong profitability during GFC (31% Gross Profit margin and 23% EBIT margin in FY2010)
* Consistent and successful focus on high margin work: 30% average EBIT margin across past 5 years
* Profitability approx 5 times higher than industry average: 5 year average EBIT 31% versus industry average 4-8% (ref IBISWorld)
* Strong revenues: 5 year average sales $2.8M p.a versus average enterprise revenue of $480k p.a (ref IBISWorld)
* Exceptional customer retention and long-term relationships (many in excess of 5 years)
* Hardware and software maintained to latest industry standards

Significant Competitive Advantage
* One of the leading design agencies in ACT
* Exceptionally well balanced portfolio of revenues:
- Balanced across sectors: 70% revenues from public sector and 30% from private sector
- Balanced across segments with 20% of work now derived from new media (highest growth sector)
- Balanced across customers: no single customer exceeds 18% total revenues
* Experienced management team (average staff tenure of 5.5 years)
* Shared corporate culture that values creativity, quality and commercial outcomes
* Client relationships shared amongst management team (ie not dependent on current owners)

Tangible Opportunities for Growth
* Company's Proprietary Publishing Product
* Growth of iPhone/iPad Apps
* Organic Growth and Proactive Marketing

Compelling Value Proposition
The 32% return on invested capital (including working capital) represents exceptional value given the Company's robust history of revenues and earnings.
Price: $ 2,800,000.00
Stock Value: Upon application
Net Profit: $ 885,000.00 approx
Turnover: $ 3,000,000.00 approx

Contact: Marcus Salouk
Scan Business Brokers
Phone: 61 7 3902 2400
Email: [email protected]