ADDISON MOORE HOLDINGS LIMITED

Executive Summary

Addison Moore Holdings Limited is currently in a fragile financial state with net assets nearly depleted and working capital dangerously low, indicating liquidity stress. Immediate actions to improve cash flow and strengthen equity are essential to prevent further financial deterioration. Without intervention, the company risks entering formal distress processes.

ADDISON MOORE HOLDINGS LIMITED - Analysis Report

Company Number: 12959951

Analysis Date: 2025-07-29 17:02 UTC

Financial Health Assessment for Addison Moore Holdings Limited

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1. Financial Health Score: D

Explanation:
The company’s financial position shows signs of very fragile health. With net assets barely above zero (£1 in 2024), and a drastic drop from £1,103 in the previous two years, Addison Moore Holdings Limited exhibits symptoms of financial distress. The minimal working capital and negligible shareholder funds indicate a precarious balance sheet typical of a company under significant strain.

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2. Key Vital Signs

• Net Assets: £1 (2024), dropped from £1,103 (2023)
  Interpretation: Net assets represent the company’s equity cushion. A sharp decline to virtually zero signals a loss of financial buffer and increased risk of insolvency.

• Current Assets: £3,503 (2024), increased from £1,601 (2023)
  Interpretation: Current assets have more than doubled, which could be positive; however, without knowing the composition (cash, debtors, stock), it may represent tied-up resources rather than liquid cash.

• Current Liabilities: £3,502 (2024), increased significantly from £498 (2023)
  Interpretation: Current liabilities have surged, nearly matching current assets, leaving only £1 net current asset. This tight liquidity position indicates the company may struggle to meet short-term obligations.

• Net Current Assets (Working Capital): £1 (2024), down from £1,103 (2023)
  Interpretation: Working capital is the company’s immediate financial “breathing room.” A near-zero working capital is a critical symptom of liquidity stress, limiting operational flexibility.

• Share Capital: £1
  Interpretation: Minimal share capital suggests limited initial investment, common for micro-entities but also means limited equity support.

• Company Category: Micro-entity
  Interpretation: As a micro-entity, the company benefits from simplified reporting but should still maintain minimum financial health to sustain operations.

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3. Diagnosis

Addison Moore Holdings Limited shows clear symptoms of liquidity stress and a fragile financial foundation. Its net assets have declined dramatically, and the working capital has virtually evaporated. The company’s current liabilities have escalated sharply, almost completely consuming current assets. This situation resembles a patient with dangerously low blood pressure—there is insufficient financial “pressure” to sustain normal business functions.

The absence of significant fixed assets or equity reserves means the company lacks a strong financial “immune system” to withstand shocks or unexpected expenses. Though the company remains active and not in liquidation or administration, the financial data suggests it is on the edge of distress with limited capacity to absorb further financial strain.

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4. Recommendations

• Improve Liquidity: Immediate focus should be on reducing current liabilities or increasing more liquid current assets (cash or receivables) to restore a safer working capital margin. This is akin to restoring healthy blood flow to vital organs.

• Seek Capital Injection: Consider increasing share capital or obtaining shareholder loans to bolster net assets and provide a financial buffer.

• Cost Control and Expense Management: Review and reduce operating expenses to ease cash flow pressures, preventing further deterioration.

• Monitor Receivables and Payables: Tighten credit control and negotiate payment terms to better align cash inflows and outflows, smoothing liquidity cycles.

• Financial Forecasting: Implement regular cash flow forecasting to anticipate future deficits and plan accordingly.

• Consider Professional Advice: If liquidity issues persist, seek insolvency or restructuring advice early to avoid formal distress procedures.

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