Quality of Earnings and CFO services for HVAC and facility services companies
Service agreements, emergency calls, replacements, and project work each earn a different multiple. We break the revenue apart, test technician capacity, and tie project profit to the WIP schedule.
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HVAC services remain an active M&A market
- HVAC services saw 92 deals in 2026 through mid-year, with private equity add-ons at 41% of transactions. Source
- Average multiples since 2024 have settled near 9.5x EBITDA, down from 13.3x in 2021 to 2023, so diligence on earnings quality matters more. Source
- Buyers test recurring vs. project revenue, maintenance agreement terms, and technician capacity. Source
- Since October 1, 2026, SBA 7(a) acquisitions of $3 million or more need an independent Quality of Earnings, and lenders size the loan on its normalized earnings. The rule explained →
We work with lenders and buyers in Utah, Denver, Phoenix, Dallas-Fort Worth, Boise, Las Vegas, and nationwide.
Maintenance agreements & renewal rateGross margin by work typeTop-5 customer concentrationBillable utilizationCallback rateBacklog
Signed, assignable, auto-renewing service agreements are the asset buyers pay most for.
What buyers and lenders test in a HVAC or facility services QoE
Revenue by type
Maintenance agreements, emergency service, replacements, installs, and commercial projects, each with its own margin.
Service agreements
Whether agreements are signed, assignable on a sale, and auto-renewing, and how many actually renew.
Technician capacity
Billable vs. unapplied time, overtime, and callbacks, so growth assumptions match the people available.
WIP and project margins
Over- and under-billings and fade on commercial projects, tied to the general ledger.
Refrigerant and equipment costs
Inventory costing and pass-through of rising refrigerant prices during the HFC phasedown.
Owner and key-account dependence
Relationships with property managers and general contractors that may not transfer.
HVAC & facility services QoE: what's included
- Revenue and margin by work type
- Maintenance agreement roll-forward and renewal testing
- WIP schedule and over/under billings
- Technician utilization analysis
- Multi-entity consolidation for combined companies
HVAC & facility services add-ons
| WIP and job-cost testing (contractor complexity) | $2,000 |
| Each additional legal entity | $2,500 |
| Inventory testing (counts, costing, reserves) | $5,000 |
Fees by deal size
| Purchase price / EV | QoE fee |
|---|---|
| Under $3M | $11,500 (sell-side $9,000) |
| $3M to $4M | $12,500 |
| $4M to $5M | $14,500 |
| $5M to $10M | $19,500 |
| $10M to $15M | from $26,500 |
| Lower middle market & PE add-ons | typically $25,000 to $70,000 |
Larger deals are quoted from revenue, entities, inventory, and report format. Pre-LOI earnings screen $1,950. All fees →
Before an LOI, run the seller's numbers through our free add-back sanity check. Terms like SDE, cash proof, and DSCR are explained in the QoE glossary.
Where HVAC and facility services owners lose money
- Jobs priced without full burdened labor cost
- No WIP schedule, so project profit shows up in the wrong year
- Truck inventory and refrigerant that never hits the books
- Maintenance agreements sold but not tracked for renewal
Priced for your industry
The step up from bookkeeping to job costing and WIP is what lets an HVAC owner see which work actually makes money.
Start with a $2,500 finance diagnostic, credited to your first month. Interim CFO or controller coverage is also available, part time from $10,500/mo or full time.
Books & close
- Monthly bookkeeping and reconciliations
- Accrual close by business day 10
- Monthly financial package
- Quarterly review call
Controller
- Everything in Books & close
- KPI dashboard for your industry
- Payroll, AP, and sales tax oversight
- Quarterly 13-week cash forecast
- Monthly review call
CFO
- Everything in Controller
- Job costing and monthly WIP schedule
- Margin by service line and technician
- Flat-rate price book review
- 13-week cash forecast and bonding support
- Monthly CFO meeting
Fixed monthly fees, month to month after three months. Day-to-day bookkeeping may be done by trained staff working to our checklists, always with CPA review and sign-off by Edwin van Stam. Talk about the right package →
HVAC & facility services engagements Edwin has led
- Multi-entity QoE on the combination of commercial facility services and mechanical companies, including working capital and customer concentration analysis, with updates through closing
- Interim CFO for a Salt Lake City energy management company
Includes engagements Edwin performed with prior and affiliated firms. Client names are confidential.
HVAC & facility services questions
Does an SBA loan for this kind of acquisition need a QoE?
Under SBA SOP 50 10 8.1, a 7(a) change-of-ownership loan with a business purchase price of $3 million or more needs a Quality of Earnings, and the lender sizes the loan on the QoE's normalized earnings. Below $3 million many lenders still ask for one. Check your deal →
Do maintenance agreements count as recurring revenue?
Only to the extent they're written, renew, and transfer with the business. We test each of those rather than taking a count of agreements at face value.
How do refrigerant price increases affect earnings?
If price increases haven't been passed through to customers, margins in the trailing twelve months may overstate what the business earns now. We look at pricing timing alongside cost.
Buying, selling, or running an HVAC or facility services company?
Buying, financing, or selling? Start with a QoE conversation. Running the business? Start with a finance diagnostic.