PRESTIGE AFFAIRES : revenue, balance sheet and financial ratios

In 2020, PRESTIGE AFFAIRES achieves revenue of 677 k€. Over the period 2017-2020, the company shows strong growth with a CAGR (compound annual growth rate) of +5.8%. Significant drop of -31% vs 2019. After deducting consumption (512 k€), gross margin stands at 165 k€, i.e. a rate of 24%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 16 k€, representing 2.3% of revenue. Warning negative scissor effect: despite revenue change (-31%), EBITDA varies by -68%, reducing margin by 2.7 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 27 k€, i.e. 4.0% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 52%. Debt remains under control: the company retains capacity to raise new debt if needed. Financial autonomy (= Equity / Total assets x 100) reaches 50%. 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 4.8 years of cash flow to repay all financial debt. This ratio remains within usual banking standards. Cash flow represents 2.1% of revenue. Cash flow measures resources generated by operations, available for investment and debt repayment.

The liquidity ratio (= Current assets / Current liabilities) stands at 376.08. 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 0.2x. 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: 23 days. Favorable situation: supplier credit is longer than customer credit by 23 days. Inventory turnover is 30 days (= Average inventory / Cost of goods x 360). Fast turnover, sign of good inventory management. Overall, WCR represents 32 days of revenue, i.e. 59 k€ to permanently finance. Over 2017-2020, WCR increased by +128%, requiring additional financing.

Based on 122 transactions of similar company sales in 2020, the value of PRESTIGE AFFAIRES is estimated at 51 348 € (range 21 736€ - 159 982€). With an EBITDA of 15 515€, the sector multiple of 2.0x is applied. The price/revenue ratio is 0.09x (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.