The Company
This Pacific-based business provides testing services on building materials (asphalt, concrete) that go into public works structures. General contractors, when using these materials, engage this Company to test the materials on site. The majority owner mastered the business over many years and founded the Company in 2013.
The Situation
As is common in the construction industry, the Company’s revenue cycle is seasonal, with limited activity in Q1 and high demand during Q2 and Q3. In 2024, adverse weather and economic conditions led to a tougher-than-usual start, resulting in operational losses. The financial strain caused the Company to violate its bank’s loan covenants, prompting the bank to exit the relationship. The bank referred the Company to Celtic Capital as it knew we would bring the client back to the bank as soon as the Company was able to overcome its temporary issues.
The Solution
Celtic Capital provided a $3,000,000 Accounts Receivable Line of Credit, which
not only refinanced the existing bank debt but also infused the working capital needed to capitalize on projected growth in 2025 and beyond. Per the Company’s request, we structured this as a short-term, one-year agreement, giving them flexibility without long-term commitment.
The Result
With a strong pipeline of upcoming projects, the Company is poised to return to profitability in Q2. While the P&L still reflects modest losses, the balance sheet remains healthy, and forward indicators point to significant improvement. Our goal is to help the Company regain banking eligibility as soon as operational consistency returns.
About Celtic Capital
Companies looking for working capital to cover operating expenses, fund growth, increase buying power, and take advantage of vendor discounts and rebates turn to Celtic Capital. With an appetite for more complex transactions, Celtic Capital has a history of success in crafting creative, flexible asset-based financing solutions from $500,000 to $8 million with no financial covenants.
As an independent lender, working with companies nationwide, Celtic Capital is willing and able to alter price and deal structure and expand lines of credit to handle its clients’ increased revenues; and when cash flow is an issue, will look toward providing an inventory facility to help offset lost cash flow.
If you know of, or are, a business in need of non-traditional financing, contact Mark Hafner at 800.742.0733 or mhafner@celticcapital.com, or visit us at celticcapital.com.