Pipeline Infrastructure &
Environmental Remediation Co.
Acquisition Opportunity - Texas
Founded
in 2012, this company installs, repairs and upgrades the energy pipeline
network that moves oil & natural gas from well sites throughout the country
to home owners, industry and export terminals. There is also a sister
company that provides complimentary environmental remediation services arising
from pipeline leaks, spills and/or related.
Revenue is generated by pipeline repairs, replacements and upgrades (60%
triggered by leaks) and new installations (40%). 40 service trucks in the field address
repairs……20 poly fusion crews all outfitted with smaller poly fusion equipment,
pneumatic pump, generator and industry tools, other 20 crews are hydrovac,
welding, internal equip service team, supervisors). They work with both steel (10%) and
polyethylene (90%) pipelines. The oil & gas pipeline industry is
driven by the volume of gas & oil production volume and not the price of
oil & gas. The industry is not cyclical like the oilfield service
industry. Pipeline work is allocated on experience, it’s
too risky to allocate based on price, therefore high profit margins. All
pipelines integrity is tested post install and repair via hydrostatic and
pneumatic testing. Strong general manager has been running the business while
owners are absentee and will remain with new owners if desired
STRONG BARRIERS TO ENTRY: 20% of
revenue is generated via installation of Thermoflex® PE pipelines which
requires certification based on years worth of training and experience. Risk
of disaster (explosions, chemical leaks) for anyone without experience is high.
New market entrants without experience cannot compete. High dollar
specialized equipment requires specially trained operators and experience
working to govt. regulations; some require 1+ year training for certification.
The company owns a large inventory of specialty pipeline equipment
including horizontal drilling, polyethylene fusion, hydrovac, ground
penetrating radar, GPS, and trenching equipment.
GROWTH
OPPORTUNITIES: Cross selling with environmental sister, which was purchased
in 2018. Rent high margin specialty equipment to others. Geographic
growth. Growth through acquisition since this is a fragmented industry
(2200 small firms). Polyethylene pipe is also being pushed in a number of
other industries such as water, broadband, and electricity infrastructure as
well as many industrial and plant applications. As a specialist in PE
pipe and fusion, these markets all represent growth opportunities.
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Financial Summary |
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2020 Est by Seller |
2019 |
2018 |
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Revenue |
$14.638 M |
$15.336 M |
$13.105 M |
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Adjusted EBITDA |
$5.708 M |
$6.207 M |
$4.999 M |
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Other Highlights |
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Financials |
Management Team in Place |
Years in Business |
SIC |
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Compiled |
Yes |
8 |
4612, 4613, 4922 |
