329 KITCHEN & BAR LIMITED

Executive Summary

329 Kitchen & Bar Limited is currently experiencing significant financial distress marked by negative working capital and net liabilities, indicating a high risk of insolvency if no action is taken. Immediate steps focusing on cash flow management, cost control, and capital injection are critical to restore financial health and support business growth. Early intervention and careful financial monitoring will be essential to improve the company’s outlook.

329 KITCHEN & BAR LIMITED - Analysis Report

Company Number: 14539665

Analysis Date: 2025-07-29 20:59 UTC

Financial Health Assessment for 329 Kitchen & Bar Limited

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1. Financial Health Score: D

Explanation:
The company shows significant financial distress characterized by negative net current assets and net liabilities. This indicates the business is currently operating in a state akin to poor health, requiring urgent intervention to restore its financial wellness.

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2. Key Vital Signs (Core Financial Metrics):

Metric	Value (£)	Interpretation
Current Assets	1,260	Extremely low liquidity buffer
Current Liabilities	119,900	High short-term obligations
Net Current Assets (Working Capital)	-113,687	Negative working capital; inability to cover short-term debts
Creditors (Due after 1 year)	50,450	Significant long-term liabilities
Net Assets	-63,237	Company’s liabilities exceed its assets
Shareholders’ Funds	-63,237	Negative equity; shareholders' investment eroded
Average Number of Employees	0	No staff employed, possibly indicating early stage or dormant operations

Interpretation of Vital Signs:

• The "healthy cash flow" is absent here; the company has only £1,260 in current assets against nearly £120,000 in current liabilities, showing symptoms of liquidity distress.
• Negative net current assets (-£113,687) signify the company cannot meet its short-term debts from its available current assets, a strong symptom of financial strain.
• Net liabilities (-£63,237) and negative shareholders’ funds indicate the company’s financial structure is under severe pressure, with debts outweighing assets.
• The absence of employees may indicate a start-up phase or a business yet to scale operations—but combined with the financial data, it may also suggest limited income generation capability so far.

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3. Diagnosis (Overall Financial Condition):

329 Kitchen & Bar Limited is in a fragile financial state, resembling a patient with critical symptoms: negative working capital and net liabilities imply the company is struggling to maintain operational liquidity and solvency. The business is very young (incorporated Dec 2022) and classified as a micro-entity, which often faces early-stage investment and cash flow challenges. However, the extent of current liabilities relative to assets is concerning and indicates a risk of insolvency if corrective actions are not promptly taken.

The company’s financial "immune system" appears weak, given the erosion of equity and high creditor exposure. This could be due to start-up costs funded by debt or delayed revenue generation. The absence of employees suggests limited operational activity or outsourcing, which can reduce fixed costs but may also limit growth potential.

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4. Recommendations (Specific Actions to Improve Financial Wellness):

• Urgent Cash Flow Management: Immediately review and renegotiate short-term liabilities to extend payment terms or reduce creditor pressures. Seeking temporary overdrafts or bridging finance may be necessary to stabilize liquidity.
• Cost Control: Minimize discretionary spending and overheads to preserve cash. Evaluate any prepayments for potential savings.
• Capital Injection: Consider raising equity or shareholder loans to restore positive net assets and improve solvency. Given the 75-100% control by Mr. Davood Najaflou, internal funding may be feasible.
• Revenue Generation: Accelerate efforts to increase sales and operational activity to generate cash inflows. Explore new customers or markets within the licensed restaurant sector.
• Financial Monitoring: Implement rigorous financial controls and regular monitoring of working capital metrics to detect and address symptoms early.
• Professional Advice: Engage with financial advisors or insolvency practitioners early to explore restructuring options before distress worsens.
• Future Planning: Develop a detailed business plan with realistic financial forecasts to support fundraising and operational decisions.

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