SARL PRUVOST PASCALE : revenue, balance sheet and financial ratios

In 2016, SARL PRUVOST PASCALE achieves revenue of 97 k€. After deducting consumption (45 k€), gross margin stands at 51 k€, i.e. a rate of 53%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 9 k€, representing 8.8% of revenue. This level of operating margin is satisfactory for the sector. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 7 k€, i.e. 7.6% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 39%. Debt remains under control: the company retains capacity to raise new debt if needed. Financial autonomy (= Equity / Total assets x 100) reaches 70%. 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 8.4 years of cash flow to repay all financial debt. Beyond 7 years, banks generally consider credit risk as high. Cash flow represents 8.0% 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 200.35. 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 7.1x. Operating income very largely covers interest expenses: high safety margin.

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: 24 days. Favorable situation: supplier credit is longer than customer credit by 24 days. Inventory turnover is 42 days (= Average inventory / Cost of goods x 360). Fast turnover, sign of good inventory management. Overall, WCR represents 36 days of revenue, i.e. 10 k€ to permanently finance.

Based on 892 transactions of similar company sales (all years), the value of SARL PRUVOST PASCALE is estimated at 25 920 € (range 11 316€ - 59 469€). With an EBITDA of 8 561€, the sector multiple of 3.0x is applied. The price/revenue ratio is 0.29x (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.