Business Insights Report
Deal Overview
EBIT
$354,000
Revenue
$905,000
Client Numbers
291
Terms
Asset or Share Sale
Price
$2,500,000
Financials
Client Groups Segmented by Age
Business Details
Business Overview
Founded in 2001, the business for sale operates a practice services 291 clients and is located in Brisbane. The business consists of two principal advisers, one additional financial planner and two administration staff. The practice's clients have an average FUM of $762,887 and has excellent profitability with an adjusted EBIT margin of 39.1%.
Their client relationships have endured for two to three decades, extending to the next generation, creating numerous familiar connections. This long-standing client loyalty reflects their commitment to providing personalized and consistent service.
Summary Statistics
291 Total Clients.
$905,542 Gross Revenue in FY23
$683,973 Advice/SMSF Ongoing Revenue
$138,600 of Risk Recurring Revenue
$87,473 SMSF Admin Only revenue
$222 Million of Funds Under Management
Business Opportunities
• The business does not actively engage in marketing activities and has becoming highly selective when considering new clients due to capacity restraints.
• Management have no desire to extend current workloads. The Admin team works four days per week, while the advisors follow a nine-day fortnight schedule.
• Considerable potential to upscale the delivery of share trading activities, which is currently in a more passive position (predominately related to capacity to deliver plus the more cautious and conservative outlook adopted by the directors).
The Business is well suited for the following scenarios:
• Financial Planning practice wanting to diversify from platform based products into SMSF and direct share trading services.
• Accounting practice wanting to expand their SMSF services with additional benefit of adding a financial planning arm to their business, with the advantage/potential in capturing “accounting based” clients from the financial planning business. The Business is regularly requested to provide referral for accounting services, noting their existing accounting connection is facing numerous headwinds.
• Stock Broking business wanting to bring in-house SMSF Administration services and further expand into financial planning industry.
Reason for Sale
Both principals are open to remaining with the business during the transition period, and one of the principals is open to staying with the business to some capacity for up to five years.
Transition
The decision to sell the business arises from the retirement plans of the directors. However, the principal advisor expresses a strong interest in remaining involved in the business and gradually transitioning out of his role over approximately five years.
Terms
Asset or Share Sale.
Price Required
Indicative offers subject to due diligence are invited, we expect offers to be around a multiple of 3 times Advice/SMSF Recurring Revenue, 1.5 times SMSF Admin Ongoing Revenue, 2.5 times Risk Recurring Revenue and 1 times Brokerage Revenue.
Purchase Price ≈ $2.5 Million Plus
The purchase price will be based off the rolling twelve-month Recurring Revenue figures at completion of Due Diligence.
Staff
2 x Principal Adviser
1 x Advisor
2 x part-time admin staff
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