A COLDWELL TILING LIMITED

Executive Summary

A Coldwell Tiling Limited is exhibiting signs of financial distress, mainly due to negative working capital and very limited shareholder funds. The company relies heavily on director loans, indicating liquidity challenges. Prompt measures to improve cash flow and bolster equity are essential to stabilize the business and support sustainable growth.

A COLDWELL TILING LIMITED - Analysis Report

Company Number: 14188750

Analysis Date: 2025-07-20 16:37 UTC

Financial Health Assessment of A Coldwell Tiling Limited

Company Overview:

• Incorporated June 2022, active private limited company operating in floor and wall covering (SIC 43330).
• Location: Rotherham, South Yorkshire, England.
• Small company filing with total exemption full accounts.

---

1. Financial Health Score: Grade D (Poor)

Explanation:
The company shows clear symptoms of financial distress due to persistent negative working capital (net current liabilities) and minimal shareholder funds. The balance sheet barely breaks even, with total assets less current liabilities at just £32 in 2024. The ongoing negative net current assets indicate cash flow challenges and potential liquidity risk, which lowers the overall financial health score.

---

2. Key Vital Signs (Critical Metrics & Interpretation)

Metric	2024 (£)	2023 (£)	Interpretation
Fixed Assets	23,928	14,666	Increase due to capital expenditure, indicating investment in plant/machinery and vehicles.
Current Assets	8,126	5,646	Growth but remains low relative to short-term obligations.
Cash at Bank	5,186	2,076	Positive sign—cash balance more than doubled, helping liquidity but still insufficient overall.
Debtors (Receivables)	2,940	3,570	Slight decrease, may reflect collection efforts or volume changes.
Current Liabilities	32,022	20,223	Significant increase, pressure on short-term debt obligations.
Net Current Assets	(23,896)	(14,577)	Negative net working capital, indicating liquidity strain and inability to cover short-term debts.
Total Assets less CL	32	89	Almost break-even—balance sheet is extremely thin and vulnerable.
Shareholders Funds	32	89	Minimal equity base, signals limited buffer for losses or operational shocks.
Director's Loan	34,229 (owed)	16,116 (owed)	Increasing reliance on director advances, indicating external financing support to sustain operations.

---

3. Diagnosis: What the Numbers Reveal About Business Health

• Liquidity Symptoms: The company exhibits a persistent "cash flow cold" condition, with net current liabilities worsening from £14.6k to £23.9k. This means current liabilities are significantly higher than current assets, a classic symptom of liquidity distress. Without sufficient liquid assets or quick cash inflows, the company may struggle to meet immediate debts, risking supplier or creditor pressure.

• Capital Structure: The shareholder funds are negligible (£32), showing a very thin equity cushion. This "fragile heart" of the balance sheet leaves little room for absorbing losses or shocks. The company’s survival currently depends heavily on director loans, which have more than doubled in a year, indicating external support acting as a life support system.

• Asset Investment: There is an increase in fixed assets, especially motor vehicles, which suggests business expansion or asset acquisition. While this can be positive, it may also be a strain on cash flow if not managed carefully, as these are less liquid assets.

• Profit and Loss Visibility: The accounts do not include an income statement, limiting visibility on profitability and operational cash flow. However, the negative working capital and reliance on director loans imply operational cash flow challenges.

• Small Company Status: As a small company, filing requirements are reduced and no audit was conducted, which may limit transparency but is typical for this size.

---

4. Recommendations: Steps to Improve Financial Wellness

1. Improve Liquidity Management:

   • Prioritize reducing current liabilities through negotiated payment terms or restructuring short-term debts.
   • Accelerate debtor collections and manage inventory tightly to improve cash conversion cycle.

2. Increase Working Capital:

   • Explore equity injection or external financing to strengthen shareholder funds, providing a buffer against financial shocks.
   • Alternatively, convert or formalize director loans into equity to reduce pressure on liabilities.

3. Cost Control and Profitability Focus:

   • Without profit data, emphasize careful cost management and pricing strategies to improve operating margins and generate positive cash flow.

4. Asset Utilisation Review:

   • Assess whether recent fixed asset acquisitions are yielding adequate returns or causing cash strain; consider asset leasing or sale if underutilized.

5. Regular Financial Monitoring:

   • Implement monthly cash flow forecasting to detect warning signs early and respond proactively, akin to regular health check-ups.

---

Summary:

The financial "vitals" of A Coldwell Tiling Limited reveal a company under strain from liquidity shortfalls and minimal equity, relying heavily on director loans to stay afloat. Immediate action to improve working capital and reduce short-term liabilities is critical to avoid deeper financial distress. Strengthening the equity base and careful operational management can help restore a healthier financial condition over the next 12-18 months.