Client Profile:
Diversified mid-sized industrial business with trading, installation, and service divisions
(Annual revenue: ~$5.4 million USD; legacy business with unstructured financial reporting)
Engagement Scope:
CFO Pulse was engaged to conduct a financial diagnostic study to evaluate division-wise performance and uncover hidden inefficiencies impacting profitability.
CFO Pulse Approach:
📂 1. Division-Wise Financial Analysis
- Broke down P&L by business unit to calculate true contribution margins
- Mapped cost centers to revenue streams across all verticals — including projects, products, and services
- Reviewed aging of receivables and project closure delays
🔎 2. Loss-Making Divisions Identification
- Identified 2 service divisions that were consistently loss-making over 6 quarters
- Exposed poor pricing discipline and cost overruns in project delivery
- Flagged high SG&A allocation on low-margin SKUs pulling down blended profitability
🎯 3. Business Restructuring Strategy
- Presented a go-forward model focusing only on profitable units
- Advised discontinuation of underperforming verticals and reallocation of capital to core trading business
- Helped create a clean MIS template for quarterly board reporting
Tangible Results:
- Helped management decide to exit 2 divisions, saving an estimated ₹42 lakh annually
- Enabled sharper focus on high-margin core verticals, improving overall EBITDA by 3.8%
- Created clear visibility into working capital deployment by business line
- Improved management confidence and investor perception due to focused performance reporting
