LOVISA RETAIL FRANCE : revenue, balance sheet and financial ratios

In 2020, LOVISA RETAIL FRANCE achieves revenue of 9.4 M€. Revenue is declining over the period 2016-2020 (CAGR: -17.5%). Significant drop of -41% vs 2019. After deducting consumption (1.7 M€), gross margin stands at 7.6 M€, i.e. a rate of 81%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 3.0 M€, representing 31.7% of revenue. Positive scissor effect: EBITDA margin improves by +24.2 pts, sign of improved operational efficiency. This high EBITDA margin provides strong self-financing capacity and resilience to uncertainties. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 145 k€, i.e. 1.5% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 0%. This very low level reflects a solid financial structure, offering significant room for future investments or acquisitions. Financial autonomy (= Equity / Total assets x 100) reaches 86%. This high autonomy means the company finances most of its assets through equity, a sign of strength. Debt repayment capacity (= Financial debt / Cash flow) indicates it would take 0.0 years of cash flow to repay all financial debt. This short period demonstrates excellent debt sustainability. Cash flow represents 22.1% of revenue. Cash flow measures resources generated by operations, available for investment and debt repayment. This high level provides strong self-financing capacity.

The liquidity ratio (= Current assets / Current liabilities) stands at 638.25. Concretely, the company has €2 of liquid assets for every €1 of short-term debt: no cash risk within 12 months. The interest coverage ratio (= EBIT / Interest expenses) is 0.1x. Danger: operating income does not cover interest charges, unsustainable situation.

Working capital requirement (WCR) measures the cash timing gap between customer collections and supplier/inventory payments. Average customer payment term: 15 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 47 days. Excellent situation: suppliers finance 32 days of the operating cycle (retail model). Inventory turnover is 18 days (= Average inventory / Cost of goods x 360). Fast turnover, sign of good inventory management. Overall, WCR represents 176 days of revenue, i.e. 4.6 M€ to permanently finance. Over 2016-2020, WCR increased by +79%, requiring additional financing.

Based on 124 transactions of similar company sales (all years), the value of LOVISA RETAIL FRANCE is estimated at 4 152 508 € (range 1 748 557€ - 8 968 907€). With an EBITDA of 2 970 656€, the sector multiple of 2.4x is applied. The price/revenue ratio is 0.17x (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.