AMA DEPENDABLE LIMITED

Executive Summary

AMA DEPENDABLE LIMITED shows a stable short-term liquidity position but operates with minimal equity and moderate debt, typical for a startup in early stages. The company must focus on strengthening its equity base and managing debt carefully while growing revenue to ensure long-term financial health. With prudent financial management and operational scalability, it has the potential for sustainable growth.

AMA DEPENDABLE LIMITED - Analysis Report

Company Number: 15613730

Analysis Date: 2025-07-29 12:24 UTC

Financial Health Assessment of AMA DEPENDABLE LIMITED

---

1. Financial Health Score: C

Explanation:
AMA DEPENDABLE LIMITED is a newly incorporated private limited company with a modest asset base and minimal equity capital. The company shows a positive net current asset position but has a very low net asset value (£95), indicating a fragile equity buffer. The presence of a bank loan exceeding current assets suggests some financial leverage. Given its early stage and limited financial history, the score reflects a cautious outlook with potential but also vulnerabilities typical for startups.

---

2. Key Vital Signs

Metric	Value (£)	Interpretation
Fixed Assets	1,543	Small asset base focused mainly on computer equipment, typical for a service-oriented business.
Current Assets (Cash)	3,156	Healthy cash balance relative to fixed assets, indicating liquidity to meet short-term needs.
Current Liabilities	604	Low short-term obligations, manageable given current assets — positive sign of working capital.
Net Current Assets	2,552	Positive working capital, meaning the company can cover short-term debts comfortably.
Long-Term Liabilities (Bank Loan)	4,000	Moderate long-term debt relative to total assets; manageable but requires careful cash flow management.
Net Assets (Equity)	95	Very low shareholder equity, indicating minimal cushion against losses or financial shocks.
Number of Employees	1	Sole director and employee — low overhead structure.

---

3. Diagnosis: What the Financial Data Reveals About Business Health

• Liquidity "Pulse": The company has a "healthy cash flow" position with cash exceeding current liabilities by a factor of over five. This is a positive sign of short-term financial stability and ability to meet immediate obligations.

• Equity "Heartbeat": The net asset value (equity) is almost negligible (£95), signaling that the company is highly leveraged relative to its equity. This thin equity "heartbeat" means the business could be vulnerable if it incurs losses or unexpected expenses.

• Leverage "Circulatory System": The existence of a £4,000 bank loan creates a "circulatory load" on the company’s finances. While not excessive at this stage, it represents ongoing fixed financial obligations that must be managed carefully, especially since the company is in its infancy.

• Operational "Muscle": With only one employee (the director), the company has a lean operational structure, which reduces fixed costs but may limit growth capacity.

• Growth and Risk Factors: Being newly incorporated (April 2024) with only the first set of financials filed, the company is in the startup phase. This period often carries risks such as uncertain cash flows, initial capital investment recovery, and building a customer base.

---

4. Recommendations: Specific Actions to Improve Financial Wellness

• Strengthen Equity Base: Consider injecting additional shareholder funds or retained earnings to build a stronger equity buffer. This will provide resilience against losses and improve borrowing capacity.

• Manage Debt Prudently: Monitor and plan for repayment or refinancing of the £4,000 bank loan to avoid stress on cash flow. Negotiate favorable terms if possible.

• Enhance Revenue Streams: Focus on growing service contracts and revenues to improve profitability and build retained earnings, which will support net asset growth.

• Maintain Cash Flow Vigilance: Keep a close watch on cash inflows and outflows to sustain the current liquidity "pulse," ensuring ability to meet both short-term liabilities and loan repayments.

• Plan for Scalability: Evaluate operational capacity and consider hiring or outsourcing strategically to support growth without significantly increasing fixed costs.

• Regular Financial Monitoring: Establish monthly or quarterly financial reviews to detect early symptoms of financial distress and adjust plans proactively.

---