Case Studies

Profit Improvement for Electronic Sign Installation Company

J.S. Held Acquires Clark Seif Clark, Strengthening West Coast Capabilities for Environmental Claims, Disputes, and Catastrophe Response

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The Situation

Electronic sign, lighting design, and installation. Annual revenues of $250 million. $60 million of debt. Approximately 1,500 salaried and hourly employees are located in 10 different sites. Operates four distinct business lines: custom signs, electronic displays, outdoor billboards, and franchising.

  • The company experienced declining sales in its two largest business lines due to weakness in the construction market and overall economic softness.
  • Additionally, operating costs were not effectively managed, and when sales declined, the Company struggled to identify cost savings to right-size its operations.
  • Several restructuring initiatives failed due to a decentralized organizational structure.
  • Financial reporting is unable to capture the true costs and profitability of custom jobs.
  • The senior lender was fatigued, as covenants had been violated, and the company was unable to produce a comprehensive restructuring plan satisfactory to the lender.

How We Advised

Our experts worked closely with the Company’s senior management team to review prior restructuring initiatives, vet current business plan assumptions, and assist the company in assembling a comprehensive restructuring plan to present to the lenders.

  • Additionally, we assisted the company in developing a rolling 13-week cash flow reporting package to help manage liquidity and evaluate cash flow at each separate business line.
  • Our team worked closely with the senior lenders to evaluate alternative restructuring options, including the sale of parts or all of the company’s business, as well as refinancing.
  • The company implemented many of our experts’ recommendations for monitoring the progress of the company’s restructuring initiatives.
  • The company successfully assembled a comprehensive restructuring plan over a nin-week period and presented it to its lenders.
  • The company was pleased with our assistance and guidance during the nine-week period and agreed to have our team stay on to monitor management’s progress in executing its restructuring plan.
  • The company secured refinancing in May 2012, which paid off existing lenders in full and provided the Company with much-needed liquidity to continue executing its restructuring plan and secure future growth capital.

Key Contact

Dan F. Dooley, CTP 
Senior Managing Director 
Strategic Advisory Practice 
+1 603 660 8952 
[email protected] 

Related Practice Areas

> Turnaround and Restructuring Services 
Navigating the many challenges confronting a company in transition requires an operationally focused approach that looks beyond the balance sheet to minimize further degradation and build a path to sustainable growth. Drawing upon decades of experience in the turnaround space, we help companies in transition identify practical strategies to improve profitability and liquidity for immediate relief, while concurrently developing and executing a comprehensive turnaround plan for long-term, sustainable value creation. 

 

> Liquidity Management 
For companies in distress or undergoing rapid growth, ensuring sufficient cash flow to support operations requires a methodical approach to liquidity management marked by multi-department input, cross-constituent communication, prioritization, and negotiation. 

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