The intelligence layer before due diligence.

Executive summary.

This report constitutes acquisition intelligence, not due diligence. It synthesises seller-provided materials, third-party financial extracts, public records, review data and category benchmarks into a decision framework. It is designed to be deployed before a formal accountant-led quality of earnings engagement, not as a substitute for one.

Tax returns & Companies House.

Companies House filings in §2.3 to §2.5 are pulled live from the public register at the moment this report is generated — no manual lookup required. Corporation Tax and VAT records in §2.1 and §2.2 are held by HMRC, which publishes no public API for either, so those remain the seller's to evidence directly.

2.1 · Corporation tax returns (CT600) — verify with seller / HMRC

Verify fields are completed from HMRC correspondence and seller-provided CT600 filings — Companies House does not publish CT600 data at all. The FY 2025–26 return is within its filing window and is not overdue.

2.2 · VAT registration & quarterly returns — verify with seller / HMRC

VAT registration number

To verify from seller

VAT scheme

Standard accrual — confirm with seller

MTD compliance

Making Tax Digital — enrolled status to verify

Quarterly returns, FY2024 to FY2026 — 12 quarters

Verify filing dates & net VAT for all twelve

Outstanding VAT liability

Confirm nil balance with HMRC VAT account

2.3 · What we already verified

2.4 · Statutory accounts

2.5 · PSC, charges & registered office

Quality of earnings.

The seller presents £305K of discretionary earnings on a summary that is not wrong, only incomplete. Below is the same business read through a buyer's lens: every add-back tested against operational necessity, every one-time charge tested against a 36-month window. The result is a defensible £269.2K of adjusted SDE — £35.8K below stated.

3.1 · SDE waterfall — reported to adjusted

3.2 · Revenue quality — channel mix & concentration

Percentages are rounded and may not sum exactly. Wholesale carries the concentration risk: two restaurants within one hospitality group represent £130,800, which is 34% of the wholesale channel and 11.6% of total revenue, with no signed supply contract since 2021. The most important and most repairable fact in the file.

The twelve vectors.

Each vector is scored 0–100 against category benchmarks drawn from the Hunter Suite reference set of 4,000-plus transactions, including 47 directly comparable specialty-coffee roaster sales. The two marks on each bar are the 50 and 70 thresholds. Weights reflect what moves outcomes in this category, not what is easy to measure.

Weighted mean of the twelve vector scores. Weights sum to 100. The unweighted mean is 67.8.

4.1 · Risk register — the five that move price

Two further risks — on governance and on the people side of the business — sit outside this financial and operational register and are covered in full in §05.

People & structure.

A business is never just its numbers. Below is how Coastal Ridge is actually governed, how it actually wins customers, and who has to show up for any of it to keep working — the parts of due diligence a P&L never shows you.

5.1 · Governance & ownership

Coastal Ridge Coffee Roasters, Ltd is run as a sole owner-operator structure: one director, one shareholder, no board and no independent oversight. That is entirely normal at this scale, but it means every material decision — pricing, hiring, the wholesale relationships, the subscription platform — currently runs through one person, with nothing written down about what happens if she is unavailable.

There is no shareholder or succession agreement on file. That is moot today with a single shareholder, but it becomes relevant the moment a buyer brings in co-investors or a management incentive scheme. The company collects customer data through its subscription platform and email marketing list — 1,840 active subscribers — but its ICO data-protection registration status has not been confirmed. A five-minute check with a real compliance cost if it turns out to be missing.

No related-party transactions were identified. The premises are leased on an arm's-length basis from an unconnected landlord.

5.2 · Marketing & sales engine

There is no dedicated sales headcount. The owner and the two production staff hold the wholesale relationships personally, and no CRM or formal pipeline exists — the book of 23 accounts is tracked in a spreadsheet. New customer acquisition leans heavily on local reputation and the 4.8-star, 1,247-review Google profile built up over eleven years, which is a durable asset but not a repeatable, buyer-controlled channel.

The subscription business — 15.4% of revenue at 84% twelve-month retention — is the one genuinely documented, diversified, platform-run revenue stream, and is worth protecting and growing after acquisition. Combined, roughly 42% of revenue sits in de facto recurring channels, but only the subscription portion is contracted at all. The wholesale share of that figure is the same handshake-pricing relationship flagged as R1 in §04.

5.3 · HR & people risk

Headcount is six staff plus the owner: two production and roasting staff — see key-person risk R2 in §04 — three retail and café staff, and one part-time delivery driver who also runs the wholesale round. Turnover has been low: one part-time barista departure in the last twelve months, otherwise a stable team with several people at three years or more.

All staff are on standard written contracts and there are no zero-hours arrangements. A NEST auto-enrolment pension scheme is in place and, on the seller's representation, up to date — confirm this directly with the provider before completion. Payroll is outsourced to a local bookkeeper rather than run in-house, which is a modest positive for continuity. No HR disputes, grievances or tribunal claims, past or ongoing, were disclosed.

5.4 · Governance & people risk register

Valuation & recommendation.

6.1 · Triangulated fair value

Weighting: SDE multiple (mid) 60%, revenue multiple 15%, DCF 25%. No asset-floor weighting is applied — net asset value is materially below the going-concern range and is not a meaningful anchor here. The DCF starts from unlevered free cash flow of £116,600: adjusted SDE of £269,200, less £66,300 to replace the owner, less corporation tax at 25% on earnings after depreciation, less £25,000 of maintenance capex and £15,000 of working capital. That base grows at 4% for five years, discounted at a 14.5% WACC, with a terminal value of 3.0× year-five SDE — the same multiple basis as the comparable set, which is 47 specialty-coffee roaster sales 2022–2025 between £0.8M and £2.4M.

6.2 · Where the price should land

At the target close band the deal trades at 3.08–3.29× adjusted SDE, in line with category comparables. Maximum total consideration — the top of the band plus the full earn-out — is £944,000 against a walk-away ceiling of £940,000, so the earn-out must be funded from retained accounts rather than from the ceiling.

Return basis: close at the £857,500 band midpoint, funded with £428,750 of equity plus the £50,000 year-one budget, and £428,750 of bank debt at 11% over seven years. Earnings are taken after replacing the owner at £66,300 and after corporation tax at 25%. The five-year return assumes an exit at 3.0× year-five SDE with the debt balance repaid.

6.3 · Four moves, in order