DIRECT BUSINESS GATE EUROPE : revenue, balance sheet and financial ratios

In 2016, DIRECT BUSINESS GATE EUROPE achieves revenue of 231 k€. Significant drop of -21% vs 2015. After deducting consumption (65 k€), gross margin stands at 166 k€, i.e. a rate of 72%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches -32 k€, representing -14.1% of revenue. Warning negative scissor effect: despite revenue change (-21%), EBITDA varies by -1229%, reducing margin by 13.2 pts. This reflects costs rising faster than revenue. Negative EBITDA means operations do not cover current expenses: concerning situation. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 597 €, i.e. 0.3% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 248%. Critical situation: debt significantly exceeds equity, severely limiting borrowing capacity and exposing the company to default risk. Financial autonomy (= Equity / Total assets x 100) reaches 26%. The balance between equity and debt is satisfactory. Debt repayment capacity (= Financial debt / Cash flow) indicates it would take 1202.4 years of cash flow to repay all financial debt. Beyond 7 years, banks generally consider credit risk as high. Cash flow represents 0.3% of revenue. Cash flow measures resources generated by operations, available for investment and debt repayment.

The liquidity ratio (= Current assets / Current liabilities) stands at 196.04. Concretely, the company has €2 of liquid assets for every €1 of short-term debt: no cash risk within 12 months.

Working capital requirement (WCR) measures the cash timing gap between customer collections and supplier/inventory payments. Average customer payment term: 3 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 145 days. Excellent situation: suppliers finance 142 days of the operating cycle (retail model). Inventory turnover is 376 days (= Average inventory / Cost of goods x 360). This high level ties up cash and potentially creates obsolescence risk. Overall, WCR represents 367 days of revenue, i.e. 235 k€ to permanently finance.

Based on 145 transactions of similar company sales (all years), the value of DIRECT BUSINESS GATE EUROPE is estimated at 27 330 € (range 15 095€ - 69 069€). The price/revenue ratio is 0.19x (conservative valuation). This multiples method compares the actual sale price of similar companies to their financial indicators (Revenue, EBITDA, Net Income). It provides a market-based indicative estimate.