Highly Profitable Confectionary and Catering Business

Industry Overview

The catering industry in South Africa generated a revenue of over R7bn according to stats SA.
The business taps into this market by supplying high quality products to high level clients throughout Gauteng. This market is continually growing and the business has positioned itself as a leader in this sector producing high end products.

Location

The business operates from a light Industrial premises in the Financial heart of Johannesburg.

Business Description

The business provides the following services in the Confectionary and Catering sector; 

• Special Events
• A Variety of Cuisine for Breakfasts, lunches, dinners for Corporate functions.
• Full range of confectionery items for coffee shops and restaurants.
• Specialty cakes for all occasions (weddings, birthday, bachelor/bachelorette, christenings etc)

The business focus on high end clients and has created a strong brand in this segment.
Prior to Covid the business was growing at 9% annually for 4 consecutive years. Post covid the business has grown at 16% annually since covid.
The business in the first six months trading of 2024 has already exceeded the profits generated in the 2023 financial year.
This profits offers exceptional returns and profits.

Financial Summary

2023 Income Statement Summary:

• Revenue:                                   R40,346,191
• Gross Profit:                             R19,651,793
• Net EBIDTA:                              R 5,122,533 

2024 Six Month trading Income Statement Summary:

• Revenue:                                    R26,430,603
• Gross Profit:                              R14,332,045
• Net EBIDTA:                               R  5,806,706

Projected Income statement for Feb 2024 Summary:

• Revenue:                                  R52,861,206
• Gross Profit:                            R28,664,090
• Net Profit:                                R10,413,412

Full financial details available on request.

Investment Rationale

The business operates in a growing vast market thus the opportunity for long term future growth is real.

The asking price with the current net profit being achieved means a return on investment of 50%

Customer Overview

The business has a strong reoccurring client base. This client base is all high end which includes corporates and private individuals.

Transaction Information

The business is operated in a Company. The Sellers are looking for a full buyout or a majority share buy out. the minority shares are owned by the General Manager who overseas the day to day operations.
A sale as a going concern out of the existing entity is also open for considerations.