PRIMECORP FINANCE SA : revenue, balance sheet and financial ratios

In 2014, PRIMECORP FINANCE SA achieves revenue of 408 k€. Revenue is growing positively over 3 years (CAGR: +1.2%). Vs 2013, growth of +78% (230 k€ -> 408 k€). After deducting consumption (0 €), gross margin stands at 408 k€, i.e. a rate of 100%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 341 k€, representing 83.5% of revenue. Positive scissor effect: EBITDA margin improves by +6.6 pts, sign of improved operational efficiency. This high EBITDA margin provides strong self-financing capacity and resilience to uncertainties. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 402 k€, i.e. 98.4% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at -209%. 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 -69%. Low autonomy: the company heavily depends on external financing (banks, suppliers). Debt repayment capacity (= Financial debt / Cash flow) indicates it would take 3.5 years of cash flow to repay all financial debt. This ratio remains within usual banking standards. Cash flow represents 69.8% 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 681.48. 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 40.1x. 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: 73 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 13 days. The gap of 60 days means the company finances its customers for over a month before being paid relative to supplier payments. This weighs on cash flow. Overall, WCR represents 80 days of revenue, i.e. 90 k€ to permanently finance. Over 2012-2014, WCR increased by +253%, requiring additional financing.

Based on 580 transactions of similar company sales (all years), the value of PRIMECORP FINANCE SA is estimated at 1 163 592 € (range 465 050€ - 2 329 783€). With an EBITDA of 341 193€, the sector multiple of 4.1x is applied. The price/revenue ratio is 0.45x (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.