Section 5.18 · released internally 22 Aug 2026 14:02
Stage 1 screening deck
Twelve slides, generated from the record. The deck exists to answer one question: is this worth the cost of Stage 2 diligence.
Contents
- Cover
- Recommendation in one line
- The business
- Three-year trading
- What the seller claims and what we accept
- Revenue quality
- Acquisition quality score
- Mandate screening
- Price
- What breaks it
- What we do not know
- Next best action
1 / 12
Stage 1 screening
Northgate Facilities Services Ltd
Facilities management contractor, Watford. Company number 09912345. Asking price £1,850,000. Prepared 22 August 2026.
Internal screening document. Analysis and modelling, not advice.
2 / 12
Attractive only below £1,740,000
The business is sound. The price is not. The gap is £110,000 against the asking price, and it is set by debt service cover rather than by the return hurdle.
Asking
£1,850,000
Year-one cover 1.37×, below the 1.5× floor
Platform maximum
£1,740,000
Cover exactly 1.50×
Opening offer
£1,380,000
Cover 2.18×, leaves room to move
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The business
Revenue, year to 31 Mar 2025
£4,120,000
Three-year CAGR 9.92%
Reported EBITDA
£521,000
Three-year CAGR 15.28%
Entity resolved to Companies House 09912345 with high confidence. Filed accounts to 31 March 2025 are the most recent available.
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Three-year trading
| £000 | FY23 | FY24 | FY25 | CAGR |
|---|---|---|---|---|
| Revenue | 3,410 | 3,780 | 4,120 | 9.92% |
| Reported EBITDA | 392 | 455 | 521 | 15.28% |
| Margin | 11.5% | 12.0% | 12.6% | — |
Three consecutive years of growth in both lines, with margin widening each year. All figures from filed accounts. Verified
5 / 12
What the seller claims and what we accept
521,000
Reported
+168,700
Seller add-backs
−16,000
Seller deduction
673,700
Seller adjusted
−16,500
Challenged
−72,000
Owner replacement
585,200
Platform normalised
Four of six seller adjustments accepted in full. The family salary add-back is cut from £28,000 to £22,500 and the exceptional legal cost from £22,000 to £11,000. The owner works in the business and replacing that role costs £72,000, which the seller does not deduct. Net effect on price at 3.4×: £300,900.
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Revenue quality
Contracted and repeat
68%
Above the 60% preference
Cash conversion
63.2%
FCF over normalised EBITDA
Largest customer
18.4%
Warning band, below the 25% refusal
Top five
46.1%
Top ten 61.7%
Recurring share and concentration are management figures, not filed. Management information Cash conversion is computed from filed accounts and platform adjustments. Calculated
7 / 12
Acquisition quality score
72
Good band. Eleven weighted components, none scored on a forecast.
| Strongest | Score | Weakest | Score |
|---|---|---|---|
| EBITDA growth | 13 / 15 | Competitive position | 3 / 5 |
| Financial quality | 12 / 15 | Growth opportunities | 3 / 5 |
| Capital efficiency | 4 / 5 | Overall risk | 3 / 5 |
| Recurring revenue | 7 / 10 | Owner independence | 6 / 10 |
8 / 12
Mandate screening
Passed
12
Of fourteen tests
Failed
1
Price against the platform maximum
Overridden
1
Owner independence, reason recorded
| Test | Mandate | Actual | Result |
|---|---|---|---|
| Asking price | At or below the platform maximum | 1,850,000 | Fail |
| Debt service cover, year 1 | 1.50× minimum | 1.78× | Pass |
| Equity IRR, base Platform forecast | 25.0% minimum | 65.3% | Pass |
| Customer concentration | Largest below 25% | 18.4% | Pass |
| Owner independence | Preference, not required | Moderate | Override |
9 / 12
Price
Multiple selected
3.40×
Range 3.0 to 3.8×
Enterprise value
£1,989,680
3.4 × 585,200
Equity after bridge
£1,597,680
Net bridge −£392,000
Maximum
£1,740,000
Cover floor binds here
Six adjustments to the base multiple net to zero, so the selected multiple equals the sector base of 3.4× from the operator assumption table v3, 1 July 2026. Operator assumption The bridge deducts £312,000 bank debt, £88,000 hire purchase, £35,000 dilapidations, £42,000 abnormal working capital and £60,000 deferred capex, and adds £145,000 cash.
10 / 12
What breaks it
Seven stress scenarios. Three breach debt service cover. None breach the return hurdle, because the return is set by the entry multiple and no operating shock changes that.
| Scenario | Year-1 cover | Result |
|---|---|---|
| Base case | 1.78× | Pass |
| Working capital shock, debtor days 55.6 to 70.6 | 1.01× | Breach |
| EBITDA down 20% | 1.44× | Breach |
| Largest customer lost | 1.40× | Breach |
| Interest up 300bp | 1.68× | Pass |
| EBITDA down 10% and rates up 200bp | 1.55× | Pass, thin |
Reverse stress: cover reaches the 1.5× floor at EBITDA of £490,200, a fall of 16.2%. That is equivalent to losing 11.5% of revenue, which is less than the largest customer represents.
11 / 12
What we do not know
Q Contract expiry ladder. Requested 18 Aug, not supplied. Without it the 68% recurring figure has no duration attached and the concentration risk cannot be dated.
Q Written statement of the owner's operational duties. Requested 18 Aug, not supplied. The £72,000 replacement cost is a platform estimate built from a job specification we have inferred.
Q Current-year management accounts. Requested 19 Aug, not supplied. Filed data ends 31 March 2025, so the most recent view of trading is roughly seventeen months old.
Q Dilapidations position on the leased depot. Requested 19 Aug, not supplied. The £35,000 bridge deduction is an estimate, not a surveyed figure.
None of these gaps has been filled with an assumption inside the recommendation. Each is priced conservatively in the bridge or excluded outright.
12 / 12
Next best action
- Obtain the two priority gaps. The contract ladder and the owner duties statement. Both change the analysis materially and neither costs anything to request.
- Open at £1,380,000 with the two challenged add-backs itemised in writing, so the negotiation runs on the numbers rather than on the gap between two adjusted EBITDA figures.
- Hold £1,740,000 as the ceiling. Above it the lender's cover test fails on our own model, which means the structure changes or the deal does not fund.
- Do not proceed to Stage 2 until the seller engages on price. Stage 2 costs real diligence spend and the current gap is £110,000 wide.
If the seller will take £500,000 as a vendor note rather than £260,000, the maximum rises to £1,917,000 and the asking price becomes fundable. That is the single most useful thing to test in the next conversation.
AcquiScope produces analysis and modelling, not regulated investment advice. This deck describes an invented business and is shown to demonstrate the generated output format.