Manufacturer of OTC pharmaceuticals and nutritional supplements. $60 million annual revenues. $20 million debt.
- Increases in oil pricing created dramatic raw material cost increases.
- Company unable to pass increases to customers, causing EBITDA deterioration.
- EBITDA of $4 million was only half of projection.
- Payables stretched to 90 days and company had no availability on their bank loan.
- MorrisAnderson assisted CFO in preparing cash flow and financial forecasts.
- Helped CFO create financial plan and forecast, coordinated bank relationships.
- Initiated numerous price increases and reduced inventory by $1 million.
- Business plan presented to bank and sub debt/equity stakeholders and negotiated increased debt support from lenders.
- Revenue increased $20 million due to price increases and new customers.
- Margins restored to plan and EBITDA increased to $8 million.
- Senior bank provided additional $2.5 million and sub debt provided additional $1.5 million term debt for business growth.
- Company became an industry price leader.