Study #4

INTERNATIONAL CHEMICALS MANUFACTURER

 

History

The client is a Chinese chemicals and colorants manufacturer and distributor with a global focus.   A private, family run business with multi millions in revenues, the company was looking to grow through acquisitions while also having an outside opinion on their financials and operations.

 

Challenge

The company was a classic example where there was great cash flow and profits, so not much focus was placed on the finance side.  While profitable, there was still plenty of opportunity to grow the company drastically and refine the operation.  The client realized this and hired Rogue CFO Consulting to be that outside expert who helps them grow.

At the same time, the company was evaluating several acquisition targets.  With no CFO in place, they needed help evaluating each deal and determining what would be the best strategy for the company.

 

The immediate needs of the client were:

* Implement a financial model to track performance

* Evaluate several acquisition targets for their fit and profit potential

* Help establish a U.S. based management team as the company expanded from China to the U.S.

* Review and give feedback on years of financial performance, providing several recommendations on ways to both bolster sales while also decreasing expenses in several areas

 

Solution

* Immediately worked on evaluating the past financial performance of the firm to find efficiencies

* Review proposed acquisition targets and provide guidance on the pros & cons of each

* Build a detailed financial forecast for each of the divisions

* Acted as a sounding board for the management team both on financial decisions and general corporate strategy

 

Results

* The company passed on most acquisitions deals once they were further evaluated and deemed inappropriate

* Sales grew by $3 million the following year, on target for 100% growth in the following year

* Company grew its international presence