INNOVATION DEVELOPPEMENT : revenue, balance sheet and financial ratios

In 2024, INNOVATION DEVELOPPEMENT achieves revenue of 12.2 M€. Over the period 2016-2024, the company shows strong growth with a CAGR (compound annual growth rate) of +6.9%. Vs 2022, growth of +26% (9.6 M€ -> 12.2 M€). After deducting consumption (2.8 M€), gross margin stands at 9.4 M€, i.e. a rate of 77%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 2.0 M€, representing 16.6% of revenue. Positive scissor effect: EBITDA margin improves by +8.2 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 1.0 M€, i.e. 8.3% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 106%. Debt level is high: negotiating margin with banks is reduced. Financial autonomy (= Equity / Total assets x 100) reaches 37%. The balance between equity and debt is satisfactory. Debt repayment capacity (= Financial debt / Cash flow) indicates it would take 4.5 years of cash flow to repay all financial debt. This ratio remains within usual banking standards. Cash flow represents 11.8% 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 406.30. 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 7.7x. 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: 39 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 70 days. Excellent situation: suppliers finance 31 days of the operating cycle (retail model). Inventory turnover is 58 days (= Average inventory / Cost of goods x 360). Overall, WCR represents 351 days of revenue, i.e. 11.9 M€ to permanently finance. Over 2016-2024, WCR increased by +248%, requiring additional financing.

Based on 197 transactions of similar company sales (all years), the value of INNOVATION DEVELOPPEMENT is estimated at 3 889 955 € (range 1 472 016€ - 9 033 545€). With an EBITDA of 2 019 940€, the sector multiple of 2.4x is applied. The price/revenue ratio is 0.28x (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.