Comprehensive Valuation Report – Forefront Protection group – Australia

BUSINESS PLANNING | INVESTOR DOCUMENTATION | STRATEGIC CONSULTING | VALUATION

Ruskin Felix Consulting LLC partnered with Jay Lark – a security services company, to understand the financial viability and the valuation of the company. The report highlights the services revenue bifurcation, and NPV of future cash flows. This report also highlights a comprehensive business assessment, industry details and the trend analysis. To understand the financial projections of the company, the report also sheds light on the revenue assessment, revenue projection, cost assessment, and cost projection. The report also sheds light on the financial metrics to value the company by analyzing the enterprise value. 

The security industry in Australia generates around $6 billion in revenue. There are in excess of 6000 security businesses around the country, with over 54 000 workers. The sector includes several major companies as well as many smaller operators. It is not uncommon for several the smaller operators in the industry to have commenced as security guards themselves. QLD, NSW and VIC account for approximately 78.8% of industry revenue due to higher population and business numbers While the sector accounts for only around 0.5% of total employment and 0.4% of businesses.

In Australia, the security industry has consistently represented more than 2% of requests for assistance involving a workplace dispute lodged with the FWO in Australia. In the 2015-16 financial year, at the time the compliance activity component of the Inquiry commenced, the security sector was ranked ninth highest in terms of workplace disputes requiring FWO intervention. The most common age group lodging requests for assistance with the FWO in the security industry is the 40 – 49 age cohort (28.7%).  

The Overall Valuation of the company from a 5 year forward EV based perspective is A$ 525,432. For purposes of Negotiation, the firm should be valued in the following range: Value of Firm Range: A$ 400,000 – A$ 600,000.

As per our information the company is looking for an investor to acquire 50% of the company. In that regard, the company’s 50% should be valued at approx. $262,000. This will also ensure that the company will have adequate cash flows to fund operations through it reserves for a period of 1.8 Years. This will ensure that the long-term profitability and growth of value in the company. It is to be noted that this valuation ignores the positive effect of landing a tender that the company avails to and only looks at linear growth of revenues through systematic scaling. This could provide very high value to the investor and help the company in future expansion as well.

By way of computation, the value of the company after license and Post COVID on a 5 Year Forward Valuation is $525k and such valuation ranges as stated should be used to sell any stake in the company.

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