ADEVO DIGITAL LLP

Executive Summary

While ADEVO DIGITAL LLP shows strong liquidity and regulatory compliance, the significant drop in profits indicates emerging financial stress. Proactive revenue and expense management alongside strategic planning will be key to restoring financial health and resilience.

View Full Analysis Report →

Company Analysis

This analysis is opinion only and should not be interpreted as financial advice.

ADEVO DIGITAL LLP - Analysis Report

Company Number: OC434034

Analysis Date: 2025-07-29 20:17 UTC

Financial Health Assessment for ADEVO DIGITAL LLP


1. Financial Health Score: C

Explanation:
The company shows a solid baseline with positive net current assets and no overdue filings, indicating operational compliance and positive working capital. However, the limited size of cash reserves and a significant drop in automatic division of profits from £252k in 2022 to £84k in 2023 signals a contraction in profitability and possibly some financial strain. The absence of employees and limited asset base suggest a lean operation but also limited capacity for growth or resilience to unexpected shocks. This places the company in a moderate risk category.


2. Key Vital Signs

Metric 2023 Value 2022 Value Interpretation
Cash at Bank & in Hand £43,070 £50,792 Moderate cash reserves; a slight decrease indicates tightening liquidity but still positive.
Net Current Assets £43,070 £50,792 Positive working capital; company can cover short-term liabilities comfortably.
Net Assets Attributable to Members £43,070 £50,792 Equity attributable to members decreased, indicating marginal erosion of net worth.
Automatic Division of Profits £84,165 £252,171 Significant drop in profits available for distribution; a symptom of reduced earnings or increased expenses.
Number of Employees 0 0 No staff employed; possibly indicates outsourcing or minimal operational activity.
Filing Status Up to date Up to date No symptoms of regulatory distress; filings are current.

Interpretation:
The financial "vital signs" show a company with a healthy liquidity buffer relative to its scale but with signs of declining profitability. The drop in distributable profits is a "symptom of distress" that warrants further investigation into revenue streams and cost management. The lack of employees suggests a very lean business model but may also limit scalability.


3. Diagnosis: Overall Financial Condition

ADEVO DIGITAL LLP appears to be a small, lean operation with adequate liquidity and no immediate solvency concerns. The company is compliant with statutory filing requirements, showing no administrative or regulatory distress signals. However, the material reduction in profits for distribution from 2022 to 2023 acts like a "warning sign" or "early symptom" that the business may be facing challenges in maintaining revenue or controlling costs.

The absence of any recorded fixed assets or significant investments further suggests that the company is relying primarily on service or consultancy activities rather than capital-intensive operations.

In medical terms, the company’s "pulse" (cash flow and liquidity) is steady but weakening profits are an indicator of underlying "organ stress" that could worsen if not addressed.


4. Recommendations: Specific Actions to Improve Financial Wellness

  1. Revenue Enhancement & Expense Control:

    • Conduct a detailed review of revenue sources to identify any decline or client loss causing lower profits.
    • Implement tighter expense controls or renegotiate supplier contracts to alleviate margin pressure.
  2. Cash Flow Management:

    • Maintain or increase cash reserves to enhance financial resilience. Consider short-term credit facilities as a buffer against cash flow fluctuations.
  3. Strategic Growth Planning:

    • Explore avenues to diversify income streams or scale up operations cautiously, potentially by hiring key personnel or investing in technology to improve service delivery.
  4. Profitability Monitoring:

    • Introduce regular and detailed financial monitoring (monthly management accounts) to catch early symptoms of financial stress and respond proactively.
  5. Stakeholder Communication:

    • Keep members informed about financial performance and any strategic changes to maintain confidence and collective support.

Executive Summary:
ADEVO DIGITAL LLP maintains a healthy liquidity position with positive net current assets and compliant filings, but faces a noticeable decline in distributable profits, signaling early financial stress. The company is advised to focus on revenue enhancement and cost management to stabilize profitability and ensure sustainable growth.


More Company Information