PHARMACIE DE LA MAIRIE : revenue, balance sheet and financial ratios

In 2018, PHARMACIE DE LA MAIRIE achieves revenue of 1.7 M€. Over the period 2016-2018, the company shows strong growth with a CAGR (compound annual growth rate) of +7.5%. Vs 2017: +4%. After deducting consumption (1.1 M€), gross margin stands at 532 k€, i.e. a rate of 32%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 153 k€, representing 9.3% of revenue. Positive scissor effect: EBITDA margin improves by +2.2 pts, sign of improved operational efficiency. This level of operating margin is satisfactory for the sector. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 119 k€, i.e. 7.2% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 43%. Debt remains under control: the company retains capacity to raise new debt if needed. Financial autonomy (= Equity / Total assets x 100) reaches 60%. 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 3.3 years of cash flow to repay all financial debt. This ratio remains within usual banking standards. Cash flow represents 7.2% of revenue. Cash flow measures resources generated by operations, available for investment and debt repayment. Satisfactory level allowing partial financing of growth.

The liquidity ratio (= Current assets / Current liabilities) stands at 193.29. 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 5.0x. Financial charges are adequately covered by operations.

Working capital requirement (WCR) measures the cash timing gap between customer collections and supplier/inventory payments. Average customer payment term: 0 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 49 days. Excellent situation: suppliers finance 49 days of the operating cycle (retail model). Inventory turnover is 34 days (= Average inventory / Cost of goods x 360). Fast turnover, sign of good inventory management. Overall, WCR represents 34 days of revenue, i.e. 157 k€ to permanently finance. Over 2016-2018, WCR increased by +46%, requiring additional financing.

Based on 177 transactions of similar company sales in 2018, the value of PHARMACIE DE LA MAIRIE is estimated at 1 361 821 € (range 1 045 480€ - 2 001 558€). With an EBITDA of 153 274€, the sector multiple of 9.1x is applied. The price/revenue ratio is 0.74x (in line with sector norms). 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.