A.I.M. BUILDING SERVICES (KENT) LIMITED

Executive Summary

A.I.M. BUILDING SERVICES (KENT) LIMITED demonstrates strong capitalization and healthy cash reserves, reflecting good financial health. However, increased short-term liabilities and reduced working capital suggest emerging liquidity risks that require careful management. Focused cash flow monitoring and working capital optimization will support sustained financial stability and growth.

A.I.M. BUILDING SERVICES (KENT) LIMITED - Analysis Report

Company Number: 14435000

Analysis Date: 2025-07-29 14:23 UTC

Financial Health Assessment Report for A.I.M. BUILDING SERVICES (KENT) LIMITED

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1. Financial Health Score: B

Explanation:
The company demonstrates a solid financial footing with positive net assets and a healthy equity base, reflecting stable capitalization. However, a noticeable reduction in net current assets and increasing current liabilities compared to previous years signals emerging liquidity pressures. While not critical, these symptoms warrant proactive management to sustain financial wellness.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Fixed Assets (Net)	39,050	21,818	Significant investment in tangible and intangible assets, indicating growth or capacity building.
Current Assets	83,410	69,471	Mainly cash; strong asset liquidity but slight increase.
Cash at Bank	82,558	69,471	Healthy cash reserves showing good cash flow management.
Debtors	852	0	Minimal trade receivables; low credit risk exposure.
Current Liabilities	76,864	49,442	Substantial increase; may indicate rising short-term obligations or supplier payments due.
Net Current Assets	6,546	20,029	Decrease signals potential tightening in working capital — a cautionary symptom of liquidity stress.
Net Assets / Shareholders' Funds	45,596	41,847	Positive and growing equity base; the company retains a healthy capital buffer.
Employee Count	2	0	Increase reflects operational expansion, but also adds fixed costs.

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3. Diagnosis: Financial Health Analysis

• Liquidity & Working Capital ("Pulse Check"):
  The company has a strong cash position, which is a vital sign of good short-term financial health. However, the sharp increase in current liabilities alongside a drop in net current assets (working capital) is a symptom of rising short-term obligations that could strain cash flow if not carefully managed. The liquidity pulse remains steady but shows signs of potential distress if liabilities continue to outpace current assets.

• Capital Structure ("Bone Strength"):
  The net assets and shareholders’ funds are positive and growing, indicating a robust capital structure. The company is well-capitalized relative to its size, which provides resilience against financial shocks. The increase in fixed assets suggests investment in operational capacity, which is a positive sign of confidence in future business growth.

• Profitability ("Vital Organ Function"):
  The absence of an income statement limits direct profitability assessment. However, the growth in retained earnings (profit and loss reserve) from £41,845 to £45,596 suggests profitability or capital injections. The company’s small size and recent incorporation (2022) mean that profitability trends should be monitored as operations scale.

• Operational Efficiency ("Breath Rate"):
  Minimal trade debtors and a low number of employees indicate tight operational control and low credit risk. However, the rise in current liabilities warrants investigation—are these trade payables increasing due to operational scaling, or are payments being delayed, potentially signaling cash flow issues?

• Governance & Control ("Nervous System"):
  Directors and significant controllers are directly involved in operations, with no red flags such as disqualifications or status issues. This close control can enhance swift decision-making but should be balanced with proper governance as the business grows.

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4. Recommendations: Improving Financial Wellness

1. Monitor and Manage Current Liabilities:
   The increase in short-term liabilities is a symptom of potential financial stress. Implement a rigorous cash flow forecasting system to ensure liabilities are met timely, avoiding liquidity crises.

2. Strengthen Working Capital Management:
   Explore ways to optimize inventory and debtor collections (though debtors are currently low) and negotiate favorable payment terms with suppliers to improve net current assets and liquidity.

3. Review Asset Investment Strategy:
   Fixed asset additions have nearly doubled, which can strain cash if not generating proportional returns. Ensure asset purchases align tightly with revenue growth plans and do not overextend financial resources.

4. Prepare for Profitability Reporting:
   As the company matures, providing clear profit and loss statements will help diagnose operational health more precisely. This also aids stakeholders in understanding the business’s earning capacity.

5. Maintain Strong Governance:
   Continue close director involvement but consider formalizing governance frameworks as the company scales, to support transparency and risk management.

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Executive Summary

A.I.M. BUILDING SERVICES (KENT) LIMITED exhibits a solid financial foundation with growing equity and strong cash reserves, signaling overall good health. However, rising current liabilities and shrinking working capital warrant close monitoring to avoid liquidity strain. Proactive management of short-term obligations and prudent investment strategy will be key to sustaining robust financial wellness as the company grows.