$11,000,000 (Proj '22)
$2,200,000 (Proj '22)
PURITY is a leading water safety and compliance company serving municipalities, industrial customers, and healthcare systems across the Midwestern and Eastern US. The Company enjoys a highly recurring revenue stream supported by multi-year contracts and consistently generates 20%+ EBITDA margins. Annual top-line growth averages 12.4% over the past five years and trending at similar levels in 2022. Services offered by PURITY are state mandated and enforced by local municipalities to ensure safe drinking water to the public resulting in a stable and predictable cash flow profile.
In recent years, the Company invested $1M+ on a proprietary software platform that is currently being commercialized as a subscription based SaaS application sold into municipalities. Approximately 65% of revenue is scheduled monthly or annual billings with the balance driven by contracted service billed by occurrence. Revenue and operating profits are very stable and reliable month-to-month.
The Company is led by a strong executive team comprised of industry veterans and supported by a certified (non-union) workforce – total headcount today is approximately 88. Many of the key leaders are well-credentialed and hold training certifications to help build and develop the workforce. As a human capital intensive business model, PURITY prides itself in providing in-house training and competitive pay and benefits packages. The Company’s culture is centered around integrity, professionalism, and being the industry standard which has resulted in market leadership for nearly 40 years.
In their mid/late 60’s, the two shareholders seek to align with an experienced capital partner or strategic acquirer that will support continued growth and professional development. One of the owners is semi-retired today and works part-time out of his Florida residence – he desires to phase out fully within the first 12 months as his role is minimal in the business today. The other shareholder is acting CFO and open to supporting a 2–3 year transition. Both are open to retained equity and taking a longer term consulting or board level role going forward. The remaining management team is fully capable of running the day-to-day and eager to align with a growth oriented partner. Additionally, the opportunity for management to participate in equity or equity-like incentive plans is viewed favorably.
The Company leases one facility (±6,000 s.f.) in the Midwest.
Market Outlook / Competition
Water quality and public safety is front of mind as local municipalities and utilities face continued regulation on protecting our most critical asset – WATER! Historically, local municipalities have relied on internal resources for test & inspection services. However, as state and local budgets tighten and the trend towards outsourced municipal services expand, PURITY is well-positioned as an industry leader to be the trusted, outsourced vendor of choice for these necessary test & inspection services. Additionally, PURITY’S domain expertise and best-in-class technology suite generates operational efficiencies resulting in cost savings for customers and an enhanced margin profile for the Company. The path towards growth includes continued geographic expansion, adding complementary service lines, and commercializing the newly developed SaaS platform on a national scale.