Company Number: 12818795

Analysis Date: 2025-07-19 12:32 UTC

Financial Health Assessment: ALGTRONIC LTD (as of 31 March 2024)

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1. Financial Health Score: B+

Explanation:
ALGTRONIC LTD demonstrates solid financial health for a micro-entity with a strong net asset position and improving working capital. The company shows healthy liquidity with net current assets substantially increasing year-on-year, indicating good short-term financial stability. While fixed assets diminished slightly, this is not alarming given the nature of the business. The shareholder equity growth reflects retained earnings and capital strengthening. Overall, the company is in good financial shape but with room to improve efficiency and asset management.

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2. Key Vital Signs

Metric	2024 Value	Interpretation
Fixed Assets	£14,299	Slight decrease from £18,143 in 2023; indicates moderate investment in long-term assets.
Current Assets	£320,341	Significant increase from previous year (£162,722); suggests improved cash or receivables.
Current Liabilities	£211,950	Increase from £138,400; must be monitored to avoid liquidity strain.
Net Current Assets (Working Capital)	£108,743	Healthy and growing buffer to cover short-term liabilities (up from £24,578).
Net Assets (Shareholders Funds)	£122,242	Strong equity position, nearly tripled from £42,021 in 2023, signaling profitability or retained earnings.
Average Employees	2	Small workforce consistent with micro-entity classification.

Vital Signs Interpretation:

• Healthy Cash Flow Indicator: The large increase in current assets and net current assets implies better cash flow or receivables management, a critical sign of liquidity health.
• Symptoms of Growing Business Strength: The tripling of net assets and shareholders' funds suggests the company is retaining profits or injecting capital, which is a positive sign.
• Warning Signs: Current liabilities have increased significantly, so the company must ensure it can meet these obligations promptly to avoid cash flow distress.

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3. Diagnosis

ALGTRONIC LTD is exhibiting signs of a financially stable and growing micro-business. The company's liquidity has improved markedly, as evidenced by the net current assets growth, which acts like a healthy pulse indicating the ability to meet short-term debts. The rising net assets and shareholders' funds resemble a strong heartbeat, showing the company is building equity and potentially profitable.

The slight decrease in fixed assets is not necessarily a concern but could indicate asset disposals or reduced capital expenditure. The increase in current liabilities is a symptom to monitor closely to avoid potential liquidity stress. The company's small size and limited employees suggest a lean operation managing resources effectively.

Overall, ALGTRONIC LTD is financially sound with no immediate symptoms of distress, showing good financial resilience typical of a healthy micro-entity in the engineering sector.

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4. Recommendations

• Maintain Strong Working Capital Management: Keep monitoring current liabilities and ensure cash inflows remain robust to cover these obligations without strain.
• Review Fixed Asset Strategy: Evaluate whether the reduction in fixed assets aligns with business needs or if reinvestment is necessary to support future growth.
• Profit Retention and Growth: Continue to build retained earnings prudently, balancing reinvestment with liquidity needs.
• Cost Control: With a small workforce, maintain tight control over operating expenses to preserve profit margins.
• Planning for Growth: Consider strategic planning for scaling operations, given the strong financial base, including potential investment in technology or market expansion.
• Regular Financial Reviews: Conduct periodic financial health check-ups to detect any early symptoms of financial distress and adjust strategies accordingly.

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