AMALGAMATED PROPERTY & ROOFING SERVICES LTD

Executive Summary

AMALGAMATED PROPERTY & ROOFING SERVICES LTD is currently showing signs of financial strain, with negative working capital and net liabilities indicating liquidity and capital erosion challenges. Immediate cash flow management and operational efficiency improvements are critical to stabilize the company’s financial health. With appropriate corrective actions, the company can restore its financial "vital signs" and improve its outlook.

AMALGAMATED PROPERTY & ROOFING SERVICES LTD - Analysis Report

Company Number: 13917494

Analysis Date: 2025-07-29 18:01 UTC

Comprehensive Financial Health Assessment:

Company: AMALGAMATED PROPERTY & ROOFING SERVICES LTD
Assessment Date: Financial year ended 28 February 2024

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1. Financial Health Score: D (At Risk)

The company shows signs of financial distress, primarily evidenced by negative net current assets and net liabilities as of the latest reporting period. While still operational and not in formal insolvency proceedings, the financial "vital signs" indicate symptoms of liquidity strain and erosion of shareholder funds, which warrant careful monitoring and remedial action.

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2. Key Vital Signs:

Metric	2024 (£)	2023 (£)	Interpretation
Current Assets	32,565	25,527	Slight growth in liquid and receivable assets
Cash at Bank	3,607	20,527	Sharp drop signals weakening cash liquidity ("weak pulse")
Debtors (Trade Receivables)	28,958	5,000	Large increase; risk of delayed cash inflow ("slow blood flow")
Current Liabilities	37,179	24,629	Rising short-term obligations ("growing pressure")
Net Current Assets (Working Capital)	-4,614	898	Negative working capital ("poor oxygen supply to operations")
Net Assets (Shareholders’ Funds)	-4,614	898	Equity deficit ("negative health baseline")

Explanation:

• Working Capital (Net Current Assets) is negative in 2024, meaning the company’s short-term liabilities exceed its liquid assets, indicating potential difficulty in meeting immediate obligations without additional financing or asset liquidation.
• Cash reserves have dropped significantly, a critical sign of cash flow distress—often the earliest symptom of financial trouble.
• Trade debtors have increased sharply, which can be a double-edged sword: while it may indicate higher sales, it also means more money is tied up in unpaid invoices, potentially worsening liquidity issues.
• Shareholders' funds have gone negative, indicating accumulated losses have eroded the company’s net worth, a serious sign of financial deterioration.

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3. Diagnosis:

The financial "symptoms" reveal a company currently experiencing liquidity stress and capital erosion within its second full year of operations. The significant drop in cash coupled with increasing current liabilities and negative net assets suggests the company is struggling to convert sales into cash efficiently. The growth in trade debtors indicates extended credit terms or collection delays, which may be exacerbating cash shortages.

This financial “patient” is showing clear signs of distress — akin to a weakened heart struggling to pump blood effectively. If untreated, this could lead to insolvency or forced restructuring. However, the company is still active, with no overdue filings or formal insolvency proceedings, indicating some operational continuity.

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4. Recommendations:

Immediate Steps (Stabilization):

• Improve cash flow management: Accelerate collection of trade receivables by tightening credit terms, offering early payment incentives, or more rigorous debtor follow-up.
• Cash preservation: Minimize non-essential expenditures and negotiate better payment terms with suppliers and creditors to ease short-term cash outflows.
• Financial monitoring: Implement weekly cash flow forecasts and scenario planning to detect and react promptly to cash shortages.

Medium-Term Strategies (Recovery):

• Review pricing and contract terms: Ensure contracts reflect appropriate margins and reduce the risk of bad debts.
• Seek additional funding: Explore options for short-term working capital loans or equity injections to restore liquidity and shore up the balance sheet.
• Operational efficiency: Investigate ways to improve project delivery and reduce costs, particularly in the roofing and building finishing operations which are the core activities.

Long-Term Outlook:

• Return to positive working capital and net assets is essential for sustainable health, requiring consistent profitability and efficient asset utilization.
• Consider professional financial advice or restructuring support if liquidity issues persist or worsen.

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