TSL SPORT EQUIPMENT : revenue, balance sheet and financial ratios

In 2023, TSL SPORT EQUIPMENT achieves revenue of 19.6 M€. Over the period 2016-2023, the company shows strong growth with a CAGR (compound annual growth rate) of +13.3%. Significant drop of -14% vs 2022. After deducting consumption (9.1 M€), gross margin stands at 10.5 M€, i.e. a rate of 54%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 2.1 M€, representing 10.8% of revenue. Warning negative scissor effect: despite revenue change (-14%), EBITDA varies by -37%, reducing margin by 3.8 pts. This reflects costs rising faster than revenue. This level of operating margin is satisfactory for the sector. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 558 k€, i.e. 2.9% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 27%. 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 64%. 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 0.7 years of cash flow to repay all financial debt. This short period demonstrates excellent debt sustainability. Cash flow represents 9.4% 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 320.76. 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 10.1x. 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: 27 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 32 days. Favorable situation: supplier credit is longer than customer credit by 5 days. Inventory turnover is 135 days (= Average inventory / Cost of goods x 360). This high level ties up cash and potentially creates obsolescence risk. Overall, WCR represents 147 days of revenue, i.e. 8.0 M€ to permanently finance. Over 2016-2023, WCR increased by +125%, requiring additional financing.

Based on 101 transactions of similar company sales (all years), the value of TSL SPORT EQUIPMENT is estimated at 4 379 206 € (range 1 493 949€ - 8 103 644€). With an EBITDA of 2 114 837€, the sector multiple of 2.5x is applied. The price/revenue ratio is 0.24x (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.