PARIS ETOILE HOTEL (P.E.H) : revenue, balance sheet and financial ratios

In 2023, PARIS ETOILE HOTEL (P.E.H) achieves revenue of 3.3 M€. Over the period 2016-2023, the company shows strong growth with a CAGR (compound annual growth rate) of +5.3%. Vs 2022, growth of +15% (2.9 M€ -> 3.3 M€). After deducting consumption (142 k€), gross margin stands at 3.2 M€, i.e. a rate of 96%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 1.2 M€, representing 36.8% of revenue. Warning negative scissor effect: despite revenue change (+15%), EBITDA varies by +6%, reducing margin by 3.0 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 609 k€, i.e. 18.5% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 223%. 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 29%. The balance between equity and debt is satisfactory. Debt repayment capacity (= Financial debt / Cash flow) indicates it would take 6.7 years of cash flow to repay all financial debt. This ratio remains within usual banking standards. Cash flow represents 21.3% 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 287.56. 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 9.5x. 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: 4 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 27 days. Favorable situation: supplier credit is longer than customer credit by 23 days. Inventory turnover is 2 days (= Average inventory / Cost of goods x 360). Fast turnover, sign of good inventory management. WCR is negative (-35 days): operations structurally generate cash. Notable WCR improvement over the period (-24%), freeing up cash.

Based on 108 transactions of similar company sales in 2023, the value of PARIS ETOILE HOTEL (P.E.H) is estimated at 3 501 369 € (range 1 427 635€ - 7 941 714€). With an EBITDA of 1 212 999€, the sector multiple of 3.7x is applied. The price/revenue ratio is 0.74x (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.