REUNION MATERIELS SERVICES : revenue, balance sheet and financial ratios

In 2024, REUNION MATERIELS SERVICES achieves revenue of 9.4 M€. Activity remains stable over the period (CAGR: -0.3%). Significant drop of -31% vs 2023. After deducting consumption (6.1 M€), gross margin stands at 3.3 M€, i.e. a rate of 35%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 405 k€, representing 4.3% of revenue. The operating margin remains fragile, requiring cost vigilance. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 40 k€, i.e. 0.4% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 438%. 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 10%. Low autonomy: the company heavily depends on external financing (banks, suppliers). Debt repayment capacity (= Financial debt / Cash flow) indicates it would take 25.5 years of cash flow to repay all financial debt. Beyond 7 years, banks generally consider credit risk as high. Cash flow represents 3.4% of revenue. Cash flow measures resources generated by operations, available for investment and debt repayment.

The liquidity ratio (= Current assets / Current liabilities) stands at 207.77. 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 17.8x. 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: 213 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 194 days. The company must finance 19 days of gap between collections and payments. Inventory turnover is 458 days (= Average inventory / Cost of goods x 360). This high level ties up cash and potentially creates obsolescence risk. Overall, WCR represents 614 days of revenue, i.e. 16.0 M€ to permanently finance. Over 2017-2024, WCR increased by +61%, requiring additional financing.

Based on 147 transactions of similar company sales in 2024, the value of REUNION MATERIELS SERVICES is estimated at 2 134 546 € (range 1 089 215€ - 3 735 873€). With an EBITDA of 405 003€, the sector multiple of 5.5x is applied. The price/revenue ratio is 0.35x (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.