CYCLABLE ENTREPRISES : revenue, balance sheet and financial ratios

In 2021, CYCLABLE ENTREPRISES achieves revenue of 1.7 M€. Over the period 2018-2021, the company shows strong growth with a CAGR (compound annual growth rate) of +37.6%. Vs 2020, growth of +32% (1.3 M€ -> 1.7 M€). After deducting consumption (944 k€), gross margin stands at 772 k€, i.e. a rate of 45%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 190 k€, representing 11.1% of revenue. Warning negative scissor effect: despite revenue change (+32%), EBITDA varies by +2%, reducing margin by 3.3 pts. This reflects costs rising faster than revenue. This level of operating margin is satisfactory for the sector. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 92 k€, i.e. 5.4% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 147%. Debt level is high: negotiating margin with banks is reduced. Financial autonomy (= Equity / Total assets x 100) reaches 17%. Low autonomy: the company heavily depends on external financing (banks, suppliers). Debt repayment capacity (= Financial debt / Cash flow) indicates it would take 1.8 years of cash flow to repay all financial debt. This short period demonstrates excellent debt sustainability. Cash flow represents 9.3% 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 121.84. 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 2.1x. 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: 88 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 105 days. Favorable situation: supplier credit is longer than customer credit by 17 days. Inventory turnover is 57 days (= Average inventory / Cost of goods x 360). Overall, WCR represents 99 days of revenue, i.e. 474 k€ to permanently finance. Over 2018-2021, WCR increased by +222%, requiring additional financing.

Based on 87 transactions of similar company sales (all years), the value of CYCLABLE ENTREPRISES is estimated at 557 820 € (range 205 830€ - 1 338 457€). With an EBITDA of 190 136€, the sector multiple of 2.3x is applied. The price/revenue ratio is 0.57x (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.
Medium reliability: estimate to be confirmed with in-depth analysis.