LHL DEVELOPPEMENT : revenue, balance sheet and financial ratios

In 2024, LHL DEVELOPPEMENT achieves revenue of 22.7 M€. Revenue is growing positively over 8 years (CAGR: +2.5%). Vs 2023: +2%. After deducting consumption (15.7 M€), gross margin stands at 7.0 M€, i.e. a rate of 31%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 1.6 M€, representing 7.0% of revenue. Warning negative scissor effect: despite revenue change (+2%), EBITDA varies by -24%, reducing margin by 2.4 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 1.3 M€, i.e. 5.8% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 2%. This very low level reflects a solid financial structure, offering significant room for future investments or acquisitions. Financial autonomy (= Equity / Total assets x 100) reaches 68%. 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 0.1 years of cash flow to repay all financial debt. This short period demonstrates excellent debt sustainability. Cash flow represents 6.1% 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 306.98. 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 0.3x. Danger: operating income does not cover interest charges, unsustainable situation.

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: 21 days. Favorable situation: supplier credit is longer than customer credit by 21 days. Inventory turnover is 27 days (= Average inventory / Cost of goods x 360). Fast turnover, sign of good inventory management. Overall, WCR represents 16 days of revenue, i.e. 994 k€ to permanently finance.

Based on 121 transactions of similar company sales (all years), the value of LHL DEVELOPPEMENT is estimated at 5 344 739 € (range 2 488 752€ - 12 448 823€). With an EBITDA of 1 584 917€, 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.