12d • General discussion
The Annuals Look Stable. The Calendar Tells the Truth.
The buyer asked for three years of financials.
The seller sent them.
Revenue was steady.
Profit was steady.
Everything looked boring, which can be beautiful.
Then the buyer asked for monthly financials.
That changed the story.
The business made nearly all its money in four months. The remaining eight months were thin. On an annual basis, it looked stable. On a monthly basis, it required cash discipline and seasonal reserves.
The deal was still interesting.
But the financing structure had to change.
Monthly financials show what annual statements hide.
They reveal seasonality, cash crunches, expense timing, and whether the business can support debt throughout the year.
This is why annual EBITDA can be misleading.
Debt service is monthly.
Payroll is weekly or biweekly.
Vendors do not wait for your good quarter.
Operators do not buy annual averages.
They buy the calendar
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The Annuals Look Stable. The Calendar Tells the Truth.
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