UNLIMITED FIGHTWEAR : revenue, balance sheet and financial ratios

In 2020, UNLIMITED FIGHTWEAR achieves revenue of 60 k€. Revenue is declining over the period 2016-2020 (CAGR: -12.8%). Significant drop of -43% vs 2019. After deducting consumption (22 k€), gross margin stands at 38 k€, i.e. a rate of 63%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 11 k€, representing 19.1% of revenue. Positive scissor effect: EBITDA margin improves by +7.3 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 4 k€, i.e. 6.8% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 53%. Debt remains under control: the company retains capacity to raise new debt if needed. Financial autonomy (= Equity / Total assets x 100) reaches 34%. The balance between equity and debt is satisfactory. Debt repayment capacity (= Financial debt / Cash flow) indicates it would take 1.7 years of cash flow to repay all financial debt. This short period demonstrates excellent debt sustainability. Cash flow represents 17.0% 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 392.85. 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 3.3x. 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: 8 days. Favorable situation: supplier credit is longer than customer credit by 8 days. Inventory turnover is 512 days (= Average inventory / Cost of goods x 360). This high level ties up cash and potentially creates obsolescence risk. Overall, WCR represents 379 days of revenue, i.e. 63 k€ to permanently finance. Over 2016-2020, WCR increased by +444%, requiring additional financing.

Based on 121 transactions of similar company sales (all years), the value of UNLIMITED FIGHTWEAR is estimated at 26 122 € (range 11 768€ - 60 861€). With an EBITDA of 11 429€, the sector multiple of 3.2x is applied. The price/revenue ratio is 0.27x (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.