VARENNES AUTO : revenue, balance sheet and financial ratios

In 2024, VARENNES AUTO achieves revenue of 2.0 M€. Over the period 2016-2024, the company shows strong growth with a CAGR (compound annual growth rate) of +5.4%. Vs 2023, growth of +11% (1.8 M€ -> 2.0 M€). After deducting consumption (1.3 M€), gross margin stands at 742 k€, i.e. a rate of 36%. This ratio measures the ability to generate value from commercial activity. EBITDA (= Gross margin - Personnel expenses - Taxes) reaches 157 k€, representing 7.7% of revenue. Positive scissor effect: EBITDA margin improves by +2.7 pts, sign of improved operational efficiency. The operating margin remains fragile, requiring cost vigilance. Ultimately, net income (= EBIT +/- financial result +/- exceptional - corporate tax) amounts to 102 k€, i.e. 5.0% of revenue. This profit can be retained or distributed to shareholders.

The debt ratio (= Financial debt / Equity x 100) stands at 14%. 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 74%. 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 0.8 years of cash flow to repay all financial debt. This short period demonstrates excellent debt sustainability. Cash flow represents 6.0% 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 484.94. 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 0.5x. 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: 16 days (formula: Customer receivables / Revenue incl. VAT x 360). Supplier term: 16 days. Inventory turnover is 41 days (= Average inventory / Cost of goods x 360). Fast turnover, sign of good inventory management. Overall, WCR represents 54 days of revenue, i.e. 305 k€ to permanently finance.

Based on 147 transactions of similar company sales in 2024, the value of VARENNES AUTO is estimated at 738 483 € (range 338 918€ - 1 313 316€). With an EBITDA of 156 793€, 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.