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Essor

presented by October France

€1,030,000

7.5%

36 months

B

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location

Location

Billère, France

activity

Activity

Properties

Presentation of the company

Created in 2001, Essor (formerly known as DPG Delta) is active in the real estate sector. The group, managed by M David Pouyanne, has 101 employees and is based in Lons.

The company’s main activities are:

  • Real estate development for industrial and commercial projects
  • Project Management with a specialization in hypermarket design, commercial hub, offices and point of sales.
  • Real estate ownership with a wide range of assets rented to corporate clients
  • Financial activities with management of a portfolio of properties as well as group treasury

The group works with key accounts.

Project Description

The company wishes to borrow 1 725 000 € over 36 months to finance renovation works on a property asset. The funding will take place in two tranches, the first one of 1 030 000 € set in place this month and the remaining one within the year.

As a reminder, the Lendix lending community supported the Essor group (formerly known as DPG Delta) in 2016 with 1 500 000 € to finance refurbishment work on warehouses.

The amount offered on the platform is limited to 504 700€, which is in line with the regulatory limits.

Analyst’s Opinion

The borrower is a holding company whose revenues are derived from services invoiced to its subsidiaries. The financial analysis was carried out on consolidated financial statements, which reflect the group’s performance.

With a consolidated turnover of 55 913 000 € in 2017 and an experienced team, the group has a good track record combined with a strong operating margin.

The increase in turnover is driven by the acquisition of the DELTA group in 2016 as well as new emblematic operations. In 2016 and 2017, the decrease in profitability is linked to the non recurring costs related to the integration of the DELTA acquisition in 2016 as well as the size of new projects for which margins are thiner. In 2017, the FCCR is impacted by exceptionnal interest and payments linked to new capital raised.

The forecast is based on the performance of 2017 as well as 2018 backlog orders for signed contracts.

The group has a solid repayment capacity with a forecast FCCR (Fixed Charge Cover Ratio *) at 1,13 and an excellent financial structure, with a forecast net debt / ebitda ratio of 1,7 and a net debt / shareholder equity of 98%.

Non convertible bonds maturing after Lendix loan have been considered as quasi equity.

Essor s debt has been partly reduced by coresponding real estate assets market value to reflect the group s strategy to building a strong portfolio of properties while engaging into opportunistic arbitrage opportunities for non strategic assets.

The analysis of the project leads to a credit rating of B and a 7,50% annual interest rate.

Strong points

  • Good historical performance of the group based on diversified corporate client base.
  • Solid repayment ability with a forecasted group FCCR of 1,13 reinforced by the support of banking pool and shareholders.
  • Group offering its business clients a wide range of solutions throughout several industrial and commercial sectors

Points of vigilence

  • The real estate industry is sensitive to economic downturn as well as delays on planned works

*The multiple of FCCR at 1,13 means that the company has a safety margin of 13% relative to its ability to repay its credit maturities.

The expert opinion is given as an indication on the basis of the elements provided by the project holder and information from our databases (Scores & Decisions, Corporate Banking File). This opinion is only an element of reflection in the decision making of a lender to participate in the financing of a project.