BizValuation
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Business
Valuation Report
Harbourline IT Services Pty Ltd
Indicative Market Value
A$3.7 million
Valuation range: A$3.3m – A$4.1m
Valuation date
30 September 2026
Purpose
Sale preparation
Location
Sydney, NSW
Prepared by BizValuation · bizvaluation.com.au · Report ref BV-2026-001
Executive Summary
We have assessed the market value of 100% of the business and assets of Harbourline IT Services Pty Ltd, a Sydney managed IT services provider, using accepted valuation methods and current market evidence for comparable Australian services businesses.
Assessed Enterprise Value
A$3,700,000
Valuation range
A$3,300,000 – A$4,100,000
Basis of value
Market value, going concern
Valuation date
30 September 2026
Purpose
Preparing the business for sale
Primary method
4.0 × maintainable EBITDA of $925,000
What supports the value
- 71% of revenue is recurring under monthly managed-service contracts
- Revenue up 39% and EBITDA margin up 1.9 points over three years
- No client above 6% of revenue; average client tenure 6.4 years
What holds it back
- Founder manages relationships for about 35% of revenue
- Only one second-tier manager; no retention plan for senior engineers
- Several client agreements cannot be assigned without consent
Key conclusion: a market value of $3.7 million is reasonable, based on 4.0 times normalised EBITDA and supported by comparable sales and a recurring-revenue cross-check.
Business Overview
Harbourline IT Services is an established managed IT services provider supporting small and mid-sized professional firms across Greater Sydney with outsourced IT support, cloud, and cyber security services.
Established
2011 (15 years)
Employees
28 (22 billable engineers)
Location
Parramatta, NSW (leased office)
Industry
Managed IT services (ANZSIC M7000)
Business model
Monthly contracts plus project work
Revenue by service line, FY25
| Service line | Revenue (A$'000) | Share | Type |
|---|---|---|---|
| Managed services contracts | 2,690 | 56% | Recurring |
| Cloud and security subscriptions | 730 | 15% | Recurring |
| Projects and migrations | 1,050 | 22% | Project |
| Ad hoc support | 350 | 7% | Project |
| Total | 4,820 | 100% | 71% recurring |
142
Active clients
5.8%
Largest client share
29%
Top 10 client share
93%
Revenue retention
Financial Performance
Revenue has grown every year since FY22, and EBITDA margin has widened as more clients moved onto fixed monthly contracts.
| Financial summary (A$'000) | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|
| Revenue | 3,480 | 3,910 | 4,350 | 4,820 |
| Gross profit | 1,530 | 1,760 | 1,990 | 2,250 |
| EBITDA | 520 | 610 | 700 | 810 |
| EBITDA margin | 14.9% | 15.6% | 16.1% | 16.8% |
| Net profit after tax | 330 | 390 | 450 | 530 |
Revenue (A$'000)
EBITDA margin (%)
Services performance indicators, FY25
$172k
Revenue per employee
71%
Billable utilisation
52%
Wages as % of revenue
31 days
Debtor days
Normalised Earnings
We adjusted the reported results to remove owner-specific and one-off items, so the earnings reflect what a new owner could expect to keep on a go-forward basis.
| EBITDA normalisation (A$'000) | Evidence | FY25 |
|---|---|---|
| Reported EBITDA | Financial statements | 810 |
| Add: owner salary above market rate | Market salary for general manager | 60 |
| Add: family member not working in business | Payroll review | 45 |
| Add: one-off recruitment and legal costs | Invoices sighted | 35 |
| Less: one-off government grant | Grant letter | (25) |
| Normalised EBITDA (maintainable) | 925 |
Normalised EBITDA of A$925,000 is used as the maintainable earnings for the valuation. It is after a market salary for the working owner, because the business is run by a manager rather than the owner alone.
Which earnings measure we use
SDE — seller's discretionary earnings
Earnings before one owner's salary. Used for owner-operated firms, usually under about $2 million revenue, where the buyer will work in the business.
EBITDA — used in this report
Earnings after a market salary for every working owner. Used for larger or management-run firms, where a buyer is purchasing a return on investment.
Items outside the enterprise value
Cash, debtors, creditors, owner loans and employee leave provisions are excluded and adjusted between buyer and seller at settlement. Normal working capital of about $180,000 is assumed to transfer with the business.
Valuation Methodology
We applied the three recognised valuation approaches, consistent with APES 225 Valuation Services. Services businesses hold few tangible assets, so their value rests on earnings: the income approach is primary and the others test it.
Income approach
Capitalisation of maintainable earnings
PRIMARYValues the business as its maintainable earnings multiplied by a capitalisation multiple that reflects the risk of those earnings.
Market approach
Comparable sales and industry rule of thumb
CROSS-CHECKCompares the result with sold prices of similar Australian services businesses, and with a multiple of recurring revenue commonly used by buyers of IT service firms.
Asset approach
Net tangible assets
FLOOR VALUEValues the business at the fair value of its equipment and working capital, with no goodwill. It sets the minimum a rational seller would accept.
How the primary value is calculated
Maintainable EBITDA × Capitalisation multiple = Enterprise value
$925,000 × 4.0 = $3,700,000
Standard of value
Market value: the price agreed between a willing buyer and seller at arm's length.
Service type
Limited Scope Valuation Engagement under APES 225.
Information relied on
FY22–FY25 accounts, client listing, staff list, contracts, owner interview.
Value Driver Scorecard
The business scores 3.85 out of 5 on the BizValuation Services Value Scorecard. That places it in the Strong band, which supports a multiple of 4.0 to 5.0 times EBITDA.
| Value driver | Weight | Score (1–5) | Weighted |
|---|---|---|---|
Owner dependency 5 = Owner under 20 hrs/week; staff hold client relationships | 20% | 0.60 | |
Recurring revenue 5 = Over 70% under retainers or contracts | 15% | 0.75 | |
Client concentration 5 = No client above 5%; top 10 under 30% | 12% | 0.48 | |
Client retention and tenure 5 = Over 90% revenue retention; tenure over 5 years | 10% | 0.40 | |
Team depth and stability 5 = Second-tier managers; turnover under 15% | 10% | 0.30 | |
Earnings trend and quality 5 = Three years of growth; clean books | 10% | 0.50 | |
Margin vs industry 5 = EBITDA margin in top quartile | 8% | 0.32 | |
Systems and documentation 5 = Documented processes; PSA software in use | 5% | 0.20 | |
Market and disruption risk 5 = Growing demand; low AI or regulatory threat | 5% | 0.15 | |
Transferability 5 = Assignable contracts; lease over 3 years | 5% | 0.15 | |
| Total score | 100% | Strong band | 3.85 |
From score to EBITDA multiple
High risk
Under 2.0
Under 2.0x
Below average
2.0–2.6
2.0–3.0x
Average
2.7–3.4
3.0–4.0x
Strong · 3.85
3.5–4.2
4.0–5.0x
Premium
4.3–5.0
5.0–7.0x
We selected 4.0x, the lower end of the Strong band, because the founder still holds relationships for about 35% of revenue.
Valuation Results
Both market cross-checks fall within 3% of the primary result, and the asset floor is well below it. Together they support an enterprise value of $3.7 million.
| Valuation method | Multiple / basis | Role | Value (A$) |
|---|---|---|---|
| Capitalisation of earnings | 4.0 × $925k EBITDA | Primary | 3,700,000 |
| Comparable transactions | 3.9 × (median of sales) | Cross-check | 3,607,500 |
| Recurring revenue rule of thumb | 1.1 × $3.42m recurring | Cross-check | 3,762,000 |
| Net tangible assets | Equipment + working capital | Floor | 410,000 |
Comparable transactions
| Business (de-identified) | Sold | EBITDA (A$'000) | Price (A$'000) | Multiple |
|---|---|---|---|---|
| Managed IT provider, Sydney | Mar 2025 | 640 | 2,430 | 3.8x |
| Managed IT provider, Brisbane | Feb 2026 | 780 | 3,040 | 3.9x |
| IT support and cloud firm, Melbourne | Nov 2025 | 1,100 | 4,400 | 4.0x |
| Median | 3.9x |
Source: BizValuation transaction database, sold prices only. Sample data for illustration.
Assessed Enterprise Value
A$3,700,000
Valuation range
A$3,300,000 – A$4,100,000
Industry Benchmarking
Harbourline is benchmarked against typical small and mid-sized IT services businesses sold in Australia, and against every other industry BizValuation covers. The applied 4.0x sits below the sector benchmark, reflecting scale and founder dependence.
6.0x
EBITDA multiple
1.1x
Revenue multiple
3.5x
SDE multiple
8.0%
Typical growth
17.0%
Typical WACC
Multiples across all industries
| Industry | EBITDA | Revenue | SDE |
|---|---|---|---|
| SaaS & software | 8.5x | 3.2x | 4.5x |
| Medical practice | 7.5x | 1.5x | 4.6x |
| Dental practice | 7.0x | 1.6x | 4.5x |
| Agriculture & farming | 6.5x | 1.0x | 3.6x |
| Allied health | 6.5x | 1.3x | 4.0x |
| Childcare & early learning | 6.5x | 1.2x | 3.8x |
| Hotel & accommodation | 6.5x | 1.6x | 3.8x |
| Aged care & home care | 6.0x | 0.7x | 3.5x |
| IT services & managed services | 6.0x | 1.1x | 3.5x |
| NDIS & disability support | 6.0x | 1.0x | 3.6x |
| Veterinary practice | 6.0x | 1.2x | 3.6x |
| Advertising & marketing | 5.5x | 1.0x | 3.2x |
| Engineering services | 5.5x | 0.8x | 3.2x |
| Heavy manufacturing | 5.5x | 0.9x | 3.3x |
| Legal practice | 5.5x | 1.2x | 3.4x |
| Pharmacy | 5.5x | 0.7x | 3.3x |
| Waste management | 5.5x | 1.2x | 3.3x |
| Consulting & professional services | 5.0x | 1.0x | 3.2x |
| E-commerce & online retail | 5.0x | 0.7x | 3.2x |
| Equipment rental & hire | 5.0x | 1.8x | 3.2x |
| Light manufacturing | 5.0x | 0.8x | 3.2x |
| Logistics & warehousing | 5.0x | 0.8x | 3.0x |
| Mining & resources services | 5.0x | 0.9x | 3.2x |
| Recruitment & staffing | 5.0x | 0.7x | 3.2x |
| Security services | 5.0x | 0.9x | 3.1x |
| Accounting & bookkeeping | 4.8x | 1.1x | 3.0x |
| Building & construction | 4.5x | 0.4x | 2.8x |
| Cleaning services | 4.5x | 0.7x | 3.0x |
| Electrical & plumbing trades | 4.5x | 0.6x | 2.9x |
| Industry | 4.5x | 0.8x | 3.0x |
| Real estate agency | 4.5x | 0.8x | 2.9x |
| Wholesale & distribution | 4.5x | 0.6x | 2.9x |
| Automotive repair & servicing | 4.0x | 0.5x | 2.8x |
| Freight & transport | 4.0x | 0.6x | 2.8x |
| Gym & fitness studio | 4.0x | 0.9x | 2.7x |
| Landscaping & gardening | 4.0x | 0.6x | 2.7x |
| Travel agency | 4.0x | 0.6x | 2.7x |
| Printing & signage | 3.8x | 0.6x | 2.6x |
| Restaurant & hospitality | 3.2x | 0.5x | 2.3x |
| Bakery & cafe | 3.0x | 0.4x | 2.2x |
Indicative SME market ranges, sorted by EBITDA multiple. Your industry is highlighted.
Sensitivity Analysis
Each 0.5x change in the multiple moves value by about $460,000; a 10% change in earnings moves it by $370,000.
| EBITDA multiple | −10% EBITDA (A$833k) | Base EBITDA (A$925k) | +10% EBITDA (A$1.0m) |
|---|---|---|---|
| 3.5x | 2,913,750 | 3,237,500 | 3,561,250 |
| 4.0x (selected) | 3,330,000 | 3,700,000 | 4,070,000 |
| 4.5x | 3,746,250 | 4,162,500 | 4,578,750 |
Assessed valuation range (enterprise value)
A$3.3m
Low
A$3.7m
Assessed
A$4.1m
High
How to lift the value
| Action | Driver | Timeframe | Est. impact |
|---|---|---|---|
| Hand founder's client relationships to the service manager | Owner dependency | 12 months | +$460k |
| Retention bonuses and restraints for senior engineers | Team depth | 3 months | +$90k |
| Add assignment clauses to client agreements at renewal | Transferability | 6 months | +$45k |
Impact estimates assume the scorecard rises enough to move the multiple; they are indicative only.
Valuation Conclusion
Based on normalised earnings, the methods applied and current market evidence, we assess the market value of the business as follows.
Assessed Enterprise Value
A$3.7m
Valuation range
A$3.3m – A$4.1m
Key factors supporting the value
- 71% recurring revenue across 142 clients; no client above 6%
- Three consecutive years of revenue and margin growth
- Scorecard of 3.85 / 5 (Strong) supports 4.0 times EBITDA
- Comparable sales and recurring-revenue cross-checks within 3%
Key assumptions and limitations
The business continues as a going concern, with a 6-month founder handover and a 3-year restraint on sale. Results rely on information entered by the user, which BizValuation has not audited or verified. The value applies only at the valuation date. This report is not financial, tax or legal advice.
System-generated valuation report
Generated automatically by the BizValuation platform, using a methodology that follows the principles of APES 225 Valuation Services, the Australian professional standard for business valuations issued by the Accounting Professional & Ethical Standards Board (APESB). Not prepared or signed by an individual valuer.
Report ID
BV-2026-001
Generated
30 September 2026
Methodology version
BizValuation v1.0
Standard of value
Market value, going concern
Data sources
User financials; BizValuation sales data
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