EXQUISITE WATER SPORTS : revenue, balance sheet and financial ratios

In 2021, EXQUISITE WATER SPORTS achieves revenue of 58 k€. Over the period 2015-2021, the company shows strong growth with a CAGR (compound annual growth rate) of +8.1%. Vs 2019, growth of +4327% (1 k€ -> 58 k€). After deducting consumption (0 €), gross margin stands at 58 k€, i.e. a rate of 100%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 15 k€, representing 25.9% of revenue. Positive scissor effect: EBITDA margin improves by +1082.6 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 563 €, i.e. 1.0% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 40723%. Critical situation: debt significantly exceeds equity, severely limiting borrowing capacity and exposing the company to default risk. Financial autonomy (= Equity / Total assets x 100) reaches 73%. 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 9.6 years of cash flow to repay all financial debt. Beyond 7 years, banks generally consider credit risk as high. Cash flow represents 37.8% 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 213.27. 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 75.0x. 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: 135 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 15 days. The gap of 120 days means the company finances its customers for over a month before being paid relative to supplier payments. This weighs on cash flow. Overall, WCR represents 537 days of revenue, i.e. 86 k€ to permanently finance. Over 2015-2021, WCR increased by +393%, requiring additional financing.

Based on 114 transactions of similar company sales (all years), the value of EXQUISITE WATER SPORTS is estimated at 51 443 € (range 28 311€ - 84 887€). With an EBITDA of 14 946€, the sector multiple of 5.1x is applied. The price/revenue ratio is 0.72x (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.