AD CONSULTING ENGINEERS LTD

Executive Summary

AD Consulting Engineers Ltd presents a strong financial position characterized by healthy cash reserves, positive working capital, and increasing equity, indicating solid financial health for a young consulting firm. While operational profitability details are limited, the company shows no signs of financial distress. Continued prudent cash management and enhanced financial transparency will support sustainable growth and long-term financial wellness.

AD CONSULTING ENGINEERS LTD - Analysis Report

Company Number: 13583727

Analysis Date: 2025-07-29 20:58 UTC

Financial Health Assessment for AD Consulting Engineers Ltd

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1. Financial Health Score: B+

Explanation:
The company demonstrates a solid financial footing with strong liquidity and positive net assets. The cash reserves have grown significantly, and working capital is healthy, indicating the company is managing its short-term obligations well. The investment in fixed assets suggests strategic use of funds for growth or operational capacity. However, as a young company with only one employee and limited disclosures (e.g., no profit and loss account included), some caution is warranted until more operational and profitability data become available.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Cash at Bank	160,222	Healthy cash reserves, increased by ~59% from 2023, indicating strong cash flow or capital injection.
Current Liabilities	32,445	Manageable short-term debts, doubled since last year but still low relative to cash.
Net Current Assets (Working Capital)	127,777	Positive and growing working capital, indicating good operational liquidity.
Total Assets Less Current Liabilities	167,308	Solid asset base after covering short-term debts.
Shareholders' Funds (Equity)	167,308	Equity has doubled since 2023, showing retained earnings or capital growth.
Number of Employees	1	Very small headcount, typical for a micro or small consulting firm.
Fixed Asset Investments	39,531	Investment in business assets, possibly equipment or long-term holdings.

Interpretation of Vital Signs:

• The company’s cash flow appears healthy, with cash increasing significantly year-over-year. This is akin to a patient showing strong pulse and hydration—signs of good short-term vitality.
• Working capital is comfortably positive, meaning the company has more current assets than current liabilities, reducing liquidity risk.
• Equity growth suggests profitability or capital injection, a positive sign of "strengthening bone structure" in financial terms.
• The increase in current liabilities warrants monitoring but is not alarming given the cash position.
• The company remains very small (one employee), so scalability and operational risks exist but have not manifested as distress signals yet.

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3. Diagnosis: Overall Financial Condition

AD Consulting Engineers Ltd is financially healthy and stable for a young private limited company operating in the engineering consulting sector. The company shows no symptoms of distress — it has sufficient cash reserves, positive net current assets, and a growing equity base. The investment in fixed assets indicates a forward-looking approach to business capacity.

The absence of an audit and limited disclosures like the profit and loss statement means that while the balance sheet "vital signs" are strong, full health of operational profitability and cash flow from operations cannot be fully assessed. The company’s status as a small entity with minimal staff also limits risk exposure but may constrain business growth potential.

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4. Recommendations to Improve Financial Wellness

• Maintain strong cash flow management: Continue to monitor cash inflows and outflows closely to preserve liquidity and avoid surprises.
• Build profitability transparency: Consider including a profit and loss account in future filings to provide fuller insight into operational performance, increasing stakeholder confidence.
• Manage current liabilities growth: Investigate reasons for the doubling of current liabilities; ensure these are manageable trade payables or taxes, not hidden debts.
• Plan for growth and scalability: With only one employee, consider strategic hiring or partnerships to increase capacity and revenue streams without overextending financial resources.
• Regular financial reviews: Conduct periodic financial "check-ups" to detect any early signs of distress, especially as the company grows in size and complexity.
• Leverage investments wisely: Ensure that the fixed asset investments generate returns or operational efficiencies; avoid over-investing in non-productive assets.
• Consider formal audit or external review: As the company grows, an audit or external financial review will improve governance and credibility with lenders or investors.

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