SOCIETE SERVICE EUROPE : revenue, balance sheet and financial ratios

In 2023, SOCIETE SERVICE EUROPE achieves revenue of 466 k€. Over the period 2016-2023, the company shows strong growth with a CAGR (compound annual growth rate) of +7.3%. Significant drop of -22% vs 2022. After deducting consumption (350 k€), gross margin stands at 115 k€, i.e. a rate of 25%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 69 k€, representing 14.8% of revenue. Positive scissor effect: EBITDA margin improves by +6.0 pts, sign of improved operational efficiency. This level of operating margin is satisfactory for the sector. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 49 k€, i.e. 10.5% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 36%. Debt remains under control: the company retains capacity to raise new debt if needed. Financial autonomy (= Equity / Total assets x 100) reaches 71%. 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 2.9 years of cash flow to repay all financial debt. This short period demonstrates excellent debt sustainability. Cash flow represents 12.4% 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 2082.21. 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 6.0x. 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: 40 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 3 days. The gap of 37 days means the company finances its customers for over a month before being paid relative to supplier payments. This weighs on cash flow. Inventory turnover is 134 days (= Average inventory / Cost of goods x 360). This high level ties up cash and potentially creates obsolescence risk. Overall, WCR represents 217 days of revenue, i.e. 281 k€ to permanently finance. Over 2016-2023, WCR increased by +50%, requiring additional financing.

Based on 145 transactions of similar company sales (all years), the value of SOCIETE SERVICE EUROPE is estimated at 149 041 € (range 54 238€ - 378 621€). With an EBITDA of 68 847€, the sector multiple of 2.6x is applied. The price/revenue ratio is 0.19x (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.