PHARMACIE HUART : revenue, balance sheet and financial ratios

In 2018, PHARMACIE HUART achieves revenue of 771 k€. Revenue is growing positively over 3 years (CAGR: +4.1%). Slight decline of -3% vs 2017. After deducting consumption (519 k€), gross margin stands at 252 k€, i.e. a rate of 33%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 37 k€, representing 4.9% of revenue. Positive scissor effect: EBITDA margin improves by +2.3 pts, sign of improved operational efficiency. The operating margin remains fragile, requiring cost vigilance. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 48 k€, i.e. 6.2% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 1125%. 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 7%. Low autonomy: the company heavily depends on external financing (banks, suppliers). Debt repayment capacity (= Financial debt / Cash flow) indicates it would take 11.8 years of cash flow to repay all financial debt. Beyond 7 years, banks generally consider credit risk as high. Cash flow represents 7.0% 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 204.73. Concretely, the company has €2 of liquid assets for every €1 of short-term debt: no cash risk within 12 months.

Working capital requirement (WCR) measures the cash timing gap between customer collections and supplier/inventory payments. Average customer payment term: 11 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 35 days. Favorable situation: supplier credit is longer than customer credit by 24 days. Inventory turnover is 24 days (= Average inventory / Cost of goods x 360). Fast turnover, sign of good inventory management. Overall, WCR represents 61 days of revenue, i.e. 130 k€ to permanently finance. Over 2016-2018, WCR increased by +117%, requiring additional financing.

Based on 177 transactions of similar company sales in 2018, the value of PHARMACIE HUART is estimated at 461 983 € (range 356 931€ - 662 437€). With an EBITDA of 37 432€, the sector multiple of 9.1x 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.