LOPEZ DECO AND CO : revenue, balance sheet and financial ratios

In 2015, LOPEZ DECO AND CO achieves revenue of 47 k€. Revenue is declining over the period 2013-2015 (CAGR: -20.4%). Significant drop of -36% vs 2014. After deducting consumption (24 k€), gross margin stands at 23 k€, i.e. a rate of 49%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 7 k€, representing 15.4% of revenue. Warning negative scissor effect: despite revenue change (-36%), EBITDA varies by -55%, reducing margin by 6.7 pts. This reflects costs rising faster than revenue. This high EBITDA margin provides strong self-financing capacity and resilience to uncertainties. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 3 k€, i.e. 5.5% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 484%. 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 72%. 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 20.7 years of cash flow to repay all financial debt. Beyond 7 years, banks generally consider credit risk as high. Cash flow represents 7.1% 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 10.25. 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 7.6x. 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: 0 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 51 days. Excellent situation: suppliers finance 51 days of the operating cycle (retail model). Inventory turnover is 47 days (= Average inventory / Cost of goods x 360). WCR is negative (-458 days): operations structurally generate cash.

Based on 575 transactions of similar company sales (all years), the value of LOPEZ DECO AND CO is estimated at 15 233 € (range 6 792€ - 28 388€). With an EBITDA of 7 186€, the sector multiple of 2.9x is applied. The price/revenue ratio is 0.21x (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.