Consumer

Advisers who understand your sector

Our consumer sector team combines a broad range of experience across consumer-facing businesses and has in-depth understanding covering retail, branded products, food and drink, leisure and travel.

Members of our advisory team have worked in an operational, management or advisory capacity for a wide variety of companies in the sector, including:

How much are companies worth in the Consumer sector?

The following 3 graphs will give private business owners a broad indication of the value of their business:

1. The Enterprise Value to EBITDA* multiples on which comparable listed companies are trading
Consumer - graph 1

At the end of H1 2020, the global, all market average Enterprise Value to EBITDA multiple for listed Consumer companies was 17.0x.This was slightly higher than the previous six months when listed Consumer companies were trading on a multiple of 16.5x. Within the Consumer sector, trading multiples varied between 14.6x and 20.2x across the range of sub-sectors. Smaller businesses generally traded on lower multiples.

* EBITDA is Earnings Before Interest, Tax, Depreciation and Amortisation
† Note, the Enterprise Value to EBITDA multiples above are for listed businesses. By comparison privately owned businesses are generally valued at a discount. Listed company data was accurate at 01/07/2020.

2. The multiple of EBITDA paid by acquirers of comparable businesses

Consumer - graph 2

The average multiple of EBITDA* paid globally in consumer transactions has increased slightly over the past 6 months. It currently stands at 12.8x. When reviewing these multiples we break out businesses in the range $5-150m, as they tend to have unique attributes which affect their valuation. Smaller businesses have generally been sold on lower multiples.

* EBITDA is Earnings Before Interest, Tax, Depreciation and Amortisation
† Note, the transaction multiples above are calculated from raw historic data. This typically understates profits and therefore valuations actually achieved are generally at lower multiples of “normalised” profits.

3. The volume of M&A transactions and acquisitions

Consumer - graph 3

In H1 2020, there were 2,248 transactions globally in the Consumer sector. This is down on the preceding 6 months, when there were 2,711 transactions. Over the past seven years the number of transactions has been relatively stable and the demand for Consumer businesses remains buoyant.

For further information as to how these valuations and statistics are computed, and their impact on your transaction, please contact us.