DEAL ROOM
PRIVATE VIEW
SELLER EXPECTATION
$2M
REVENUE (LTM)
$1,815,687
NET PROFIT
$429,285
SDE (ESTIMATED)
~$429,485
Acquisition Price
$2.25M
2025 ADJ.EBITDA
$884K
BUYER EQUITY
$500K
IMPLIED MULTIPLE
$2.5K
The Opportunity
This is an established HVAC business with maintenance agreements, service work, and replacement revenue. The company has operated since 2005, employs 11 people, and has a meaningful commercial customer base. The seller is expected to provide financing and transition support, which helps keep the buyer’s cash into the deal at $500K under the proposed structure.
The business is being offered at roughly 2.5x the reported 2025 adjusted EBITDA. Possible operating levers include hiring technicians, growing commercial work, improving digital lead flow, adding plumbing, and expanding into nearby markets.
BUYER EQUITY
$500K
SELLER NOTE
$500K
BANK / SBA
$1.25M
What Needs to Be Proven
Earnings Quality
The reported adjusted EBITDA needs to tie back to tax returns, general ledger activity, bank statements, and every add-back.
Owner Replacement
The current owner handles estimating, sales, relationships, and management. The cost to replace those duties must be underwritten.
downside coverage
Test customer concentration, normal CapEx, working capital, taxes, and debt service under lower-revenue cases.
The Opportunity
DEAL SNAPSHOT
At-a-glance summary of the opportunity. All financial figures are seller-reported and unverified. Identifying details redacted pending NDA.
At-a-glance summary of the opportunity. All financial figures are seller-reported and unverified. Identifying details redacted pending NDA.
OPPORTUNITY HIGHLIGHTS
• Exceptional profitability across all three years.
23.6–31.3% net margins vs. 5–10% industry average for plumbing & HVAC contractors.
• Completely debt-free with significant cash on hand; building, land, and all equipment fully owned.
• Clear succession pathway with two named internal candidates; owners committed to training the identified gap (bidding & estimating).
TRANSACTION DETAILS
Seller Expectation: $2,000,000 (inclusive of land, commercial building, and all business assets). Deal Structure: Business + building + land. Asset sale implied. Owners open to offers.
Reason for Sale: Owners ready to exit. Now actively re-marketing to qualified buyers. Timeline to Sell: Motivated. Not exploratory. Business was previously listed; owners are ready.
TEAM & OWNER
Employees: Estimated 5–10 field employees based on wage structure. Two named internal succession candidates.
Owner Involvement: Both partners full-time. Primary skill gap for successors is bidding/estimating. Owners willing to teach.
Deal Highlights
INDUSTRY
Plumbing & HVAC
Residential & Commercial Services
BUSINESS TYPE
LLP
Two active partners
OWNED REAL ESTATE
YES
Included in seller expectation
OWNER INVOLVEMENT
Moderate - High
INDUSTRY
Plumbing & HVAC
Residential & Commercial Services
BUSINESS TYPE
LLP
Two active partners
OWNED REAL ESTATE
YES
Included in seller expectation
OWNER INVOLVEMENT
Moderate - High
Financial Performance
YEAR
2023
2024
2024 LTM
REVENUE
$2,252,877
$2,227,141
$1,815,687
NET INCOME
$604,657
$696,362
$429,285
All figures seller-reported. Source: QuickBooks P&L, Accrual Basis. Gross Profit, Gross Margin %, EBITDA (Reported), and EBITDA Margin % were not separately reported for 2023, 2024, or 2025 LTM.
YEAR 2023
Revenue - $2,252,877
Net Income - $604,657
YEAR 2024
Revenue - $2,227,141
Net Income - $696,362
2024 LTM
Revenue - $1,815,687
Net Income - $429,285
All figures seller-reported. Source: QuickBooks P&L, Accrual Basis. Gross Profit, Gross Margin %, EBITDA (Reported), and EBITDA Margin % were not separately reported for 2023, 2024, or 2025 LTM.
Complete Source Brief
Company Overview
• Company Name: [Provided Upon NDA Execution].
• Industry / Subcategory: Plumbing & HVAC — Residential & Commercial Services.
• Location: [Provided Upon NDA Execution].
• Years in Business: Long-established; significant operating history in the community.
• Business Type: LLP (Limited Liability Partnership) — two active partners.
• Website: [Provided Upon NDA Execution].
REVENUE
• Revenue (LTM): $1,815,687.
• EBITDA (Reported): Not separately reported (see Net Income).
• EBITDA Margin: —.
• Net Profit: $429,285.
• Net Profit Margin: 23.6%.
• SDE (Estimated): ~$429,485.
Add-Backs & Adjusted Earnings
• Reported Net Income (LTM): $429,285.
• Verified Add-Backs: $200 — donation (add-back).
• Potential / Unverified Add-Backs: $0 — none identified.
• Adjusted SDE: $429,485.
• SDE (Estimated): ~$429,485 (2025 LTM); 3-year average ~$577,133.
• Reported Net Income (LTM): $429,285.
• Verified Add-Backs: $200 — donation (add-back).
• Potential / Unverified Add-Backs: $0 — none identified.
• Adjusted SDE: $429,485.
• SDE (Estimated): ~$429,485 (2025 LTM); 3-year average ~$577,133.
Financial Commentary
2025 revenue declined −18.5% to $1,815,687. The most significant metric in this profile. Both labor and parts revenue declined approximately 19% in parallel, suggesting a broad reduction in job volume; understanding the root cause is a buyer's first priority.
Despite the decline, net margin held at 23.6% in 2025, demonstrating real cost discipline, and the business consistently outperforms the 5–10% industry average for plumbing and HVAC contractors.
The business is entirely debt-free. The $2M asking price against a 3-year average SDE of ~$577K implies a multiple of approximately 3.5× — reasonable for a trades business with real estate included. Full financial detail including expense breakdown, balance sheet, and add-back analysis provided upon NDA execution.
Revenue Breakdown
By Service / Product Line: Labor: ~46–49% of revenue. Parts Sales: ~43–45%.
Equipment/Machine Hire: ~4–5% (declining trend). Other minor lines.
By Customer Type: Mix of residential and commercial clients. Broad community customer base in an established small-market position.
Customer Concentration: Top 1 customer, Top 3 customers, and Top 10 customers are not disclosed. Concentration risk: Low–Moderate — no customer-level data available. Small market limits the new-customer universe but also implies limited local competition; dominant brand position mitigates concentration risk.
Recurring Revenue: No formal service contracts documented. Plumbing and HVAC are structurally recurring services with strong repeat-customer penetration.
Seasonality: Cold-climate region creates strong structural HVAC demand (heating installs, furnace service). Plumbing is year-round. Summer construction provides a secondary revenue peak.
Customers & Sales
Lead Sources: Word of mouth (primary — owner-confirmed dominant channel), local radio advertising (secondary). Demand is largely inbound. Advertising spend <0.2% of revenue.
Sales Process: Owners currently handle all bidding and estimating. Two internal candidates can manage operational execution. Bidding/estimating is the one identified transition gap — owners committed to training successors.
Average Deal Size: Avg new customer value and Avg lifetime value (if known) are not disclosed. Repeat Business: Implied to be very high. Word-of-mouth as the primary growth driver and long community tenure point to strong customer retention.
Lead Sources: Word of mouth (primary — owner-confirmed dominant channel), local radio advertising (secondary). Demand is largely inbound. Advertising spend <0.2% of revenue.
Sales Process: Owners currently handle all bidding and estimating. Two internal candidates can manage operational execution. Bidding/estimating is the one identified transition gap — owners committed to training successors.
Average Deal Size: Avg new customer value and Avg lifetime value (if known) are not disclosed. Repeat Business: Implied to be very high. Word-of-mouth as the primary growth driver and long community tenure point to strong customer retention.
Operations & Succession
Employee Overview: Total headcount not specified. Based on wages, approximately 5–10 field employees at typical regional trades wages. Two named individuals are the owners' identified successors for operational management; names provided upon NDA execution.
Key Operator (#2): Name / Role: [Provided Upon NDA Execution].
Tenure: Not disclosed.
Functions owned: Operational execution; bidding/estimating is the identified transition gap.
Stay-on likelihood: High — two owner-identified succession candidates are committed to remaining and can handle operational execution.
Owner Role: Moderate–High currently. Both owners manage bidding, estimating, and overall business direction.
Business Dependency on Owner: Dependency level: Moderate–High.
Key risks if owner departs: Succession profile is stronger than typical: two operationally capable internal candidates exist, and the identified gap (bidding) is bounded and teachable.
Systems & SOPs: QuickBooks (accrual basis). No CRM, dispatch, or field service management software identified. No formal written SOPs mentioned. Standard profile for an owner-operated trades business of this size.
Tech Stack: QuickBooks (accounting, accrual basis); local radio advertising as the one confirmed paid media channel; no field service management software or CRM/digital customer tracking identified.
Assets
Equipment: $497,133 at original cost. Accumulated depreciation frozen at $266,507 — net book value ~$230,626. Buyer must physically assess condition, age, and replacement timeline during diligence.
Vehicles: Active vehicle fleet confirmed by mileage reimbursement line ($37K–$41K/yr).
Specific fleet inventory and condition provided upon NDA execution. Inventory: No separate inventory line — materials are expensed directly per job. Favorable structure for buyers: minimal working capital in stock, no obsolescence risk.
Real Estate / Lease: Status: Owned.
Address(es): [Provided Upon NDA Execution].
Lease terms: N/A — owned, not leased.
Owned RE in deal?: Yes — included in the $2,000,000 asking price; independent real property appraisal required before closing.
Equipment: $497,133 at original cost. Accumulated depreciation frozen at $266,507 — net book value ~$230,626. Buyer must physically assess condition, age, and replacement timeline during diligence.
Vehicles: Active vehicle fleet confirmed by mileage reimbursement line ($37K–$41K/yr).
Specific fleet inventory and condition provided upon NDA execution. Inventory: No separate inventory line — materials are expensed directly per job. Favorable structure for buyers: minimal working capital in stock, no obsolescence risk.
Real Estate / Lease: Status: Owned.
Address(es): [Provided Upon NDA Execution].
Lease terms: N/A — owned, not leased.
Owned RE in deal?: Yes — included in the $2,000,000 asking price; independent real property appraisal required before closing.
Growth Opportunities
• Service contracts & preventive maintenance: no recurring maintenance contracts exist; in a cold-climate market, annual furnace and boiler check programs are high-demand and high-margin.
• Digital presence: advertising spend is <0.2% of revenue — investing in Local Services Ads and a basic website could capture meaningfully more residential leads at low cost.
• Revenue recovery: labor and parts revenue both declined ~19% in 2025; if this reflects owner bandwidth or reduced marketing effort, a motivated operator could rebuild quickly.
• Machine hire / heavy equipment: this segment has declined over three years and could be re-activated through direct outreach to contractors and developers if equipment is serviceable.
• Geographic expansion: the business sits in a smaller regional market with a larger metro area within driving distance — extending service territory with one additional truck and technician could access a materially larger customer base.
• Field service management platform: none in place today; implementing one would unlock service contract management, digital dispatching, automated follow-up, and online booking.
Marketing Overview
Channels: Local radio (confirmed) and word of mouth (primary driver per owners); no digital marketing identified. Ad spend averaged ~$3,360/yr (2023–2025), less than 0.2% of revenue — the business generates $1.8M–$2.3M annually on essentially zero marketing investment.
Website Observations: Likely minimal or non-existent. Minimal marketing spend confirms the brand's organic strength but also means growth has been deliberately constrained; a buyer investing $1,500–$2,000/month in digital marketing could reach a meaningfully larger addressable market.
Channels: Local radio (confirmed) and word of mouth (primary driver per owners); no digital marketing identified. Ad spend averaged ~$3,360/yr (2023–2025), less than 0.2% of revenue — the business generates $1.8M–$2.3M annually on essentially zero marketing investment.
Website Observations: Likely minimal or non-existent. Minimal marketing spend confirms the brand's organic strength but also means growth has been deliberately constrained; a buyer investing $1,500–$2,000/month in digital marketing could reach a meaningfully larger addressable market.
Additional Context
Owner Compensation: Salary / Draw: Combined owner distributions ~$638,000 in 2024.
Per call: owners “take whatever they want.” Distributions flow outside the income statement in an LLP structure. Benefits / Perks: Not disclosed.
Total comp included in add-backs?: No — Net income IS the SDE baseline.
Family Involvement: Not disclosed. Transition Plan: Owners willing to teach bidding/estimating and support transition.
Two internal candidates can handle operational execution. This is a relatively clean transition profile for a skilled-trades acquisition.
Owner Compensation: Salary / Draw: Combined owner distributions ~$638,000 in 2024.
Per call: owners “take whatever they want.” Distributions flow outside the income statement in an LLP structure. Benefits / Perks: Not disclosed.
Total comp included in add-backs?: No — Net income IS the SDE baseline.
Family Involvement: Not disclosed. Transition Plan: Owners willing to teach bidding/estimating and support transition.
Two internal candidates can handle operational execution. This is a relatively clean transition profile for a skilled-trades acquisition.
Deal Notes
• 2025 Revenue Decline (−18.5%) — Revenue declined from $2.23M to $1.82M in 2025. Root cause unknown; the single most important question for any buyer before pricing a deal.
• Auto & Truck Expense — Near-Zero in 2025 — Vehicle expenses collapsed 94% in 2025. Until reconciled, 2025 net income may be slightly overstated.
• Bad Debts — Two Consecutive Years — Bad debts appeared in 2024 and persisted in 2025 at lower levels. AR aging schedule should be requested.
• Depreciation Frozen — Asset Condition Unknown — No current depreciation is being recorded. Buyer must physically inspect all equipment and vehicles; replacement capital needs are not reflected in the financials.
• Real Property — Book Value vs. Market Value — Building and land are carried at historical cost. Current market value is materially higher; an independent appraisal is required.
• Outside Investment — Undisclosed — A $50,000 outside investment appears on all three balance sheets without explanation. Must be clarified before any offer.
• Insurance — 2024 Anomaly — Insurance expense was anomalously low in 2024 but recovered in 2025. Confirm there were no uninsured claims or liability exposure from that period.
• Key Employee Retention — Two named succession candidates are critical to transition. No employment agreements are in place; buyer must assess and negotiate retention before close.
• Machine Hire Revenue — Three-Year Decline — A 29% decline over three years.
Understand whether equipment is aging, in disrepair, or whether demand has softened.
• Valuation Context — $2M Asking Price — Approximately 3.5× SDE on the 3-year average. Reasonable for a trades business with real estate included, but the 2025 revenue trend warrants scrutiny.
CONFIDENTIAL MATERIAL — INDEPENDENT DILIGENCE REQUIRED
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