JKS AUTOMOBILES : revenue, balance sheet and financial ratios

In 2023, JKS AUTOMOBILES achieves revenue of 897 k€. Vs 2021, growth of +26% (712 k€ -> 897 k€). After deducting consumption (715 k€), gross margin stands at 182 k€, i.e. a rate of 20%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 20 k€, representing 2.2% of revenue. Warning negative scissor effect: despite revenue change (+26%), EBITDA varies by -73%, reducing margin by 7.9 pts. This reflects costs rising faster than revenue. The operating margin remains fragile, requiring cost vigilance. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 6 k€, i.e. 0.6% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 82%. Debt level is high: negotiating margin with banks is reduced. Financial autonomy (= Equity / Total assets x 100) reaches 33%. The balance between equity and debt is satisfactory. Debt repayment capacity (= Financial debt / Cash flow) indicates it would take 19.0 years of cash flow to repay all financial debt. Beyond 7 years, banks generally consider credit risk as high. Cash flow represents 0.6% of revenue. Cash flow measures resources generated by operations, available for investment and debt repayment.

The liquidity ratio (= Current assets / Current liabilities) stands at 375.71. 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 13.1x. 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: 1 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 29 days. Favorable situation: supplier credit is longer than customer credit by 28 days. Inventory turnover is 120 days (= Average inventory / Cost of goods x 360). This high level ties up cash and potentially creates obsolescence risk. Overall, WCR represents 95 days of revenue, i.e. 236 k€ to permanently finance.

Based on 149 transactions of similar company sales in 2023, the value of JKS AUTOMOBILES is estimated at 49 617 € (range 22 938€ - 122 025€). With an EBITDA of 19 836€, the sector multiple of 1.3x is applied. The price/revenue ratio is 0.13x (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.