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Case Study: Heat Exchange and Hydraulic Cylinder Manufacturer
Financial Advisory, Turnaround Management, Due Diligence
Company: A $26 million manufacturing company consisting
of two business units; NDM, a producer of custom designed heat exchangers
for military & Industrial applications; and HDM, a manufacturer of hydraulic
cylinders for the auto-transport, snow plow, and other industry segments
using large and small bore cylinders.
Situation / Tasks Performed: Initially, TRG was hired
by the lender to provide a performance overview and due diligence on the
company's financial plan. The engagement later converted to working directly
for the company as management embraced our analysis performed for the lender.
We prepared a detailed cash flow budget for the company, presented it with
the company to the bank and assisted with its implementation.
In addition to our overall recommendations, TRG also analyzed all aspects
of HDM's plant utilization and designed a one-piece flow strategy. The
facility was reconfigured, material purchasing and planning procedures
were revised, and the workforce was realigned to meet the needs of the
new production strategy.
Results: Over the course of a seven month period,
the company increased its profitability more than three fold and became
cash flow positive. Monthly budgets were regularly achieved for the first
time in over two years. In addition to budgeting, TRG identified and directed
costs savings throughout the organization. HDM's manufacturing facility
was reconfigured to a total flow layout. The company was positioned for
success and growth.
Nature of Assignment:
Primary: Financial Advisory
Secondary: Turnaround Management
Tertiary: Due Diligence
Industry: Manufacturing
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