Company Number: 13889007

Analysis Date: 2025-07-20 19:07 UTC

Financial Health Assessment Report for ANDREAS HOLDINGS LIMITED

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1. Financial Health Score: D

Explanation:
The company shows signs of financial distress with persistent negative net assets and net current liabilities over the last three years. These are symptoms of underlying financial weakness, indicating that the company’s liabilities exceed its assets, a situation akin to a patient with a chronic condition that requires immediate attention to avoid further deterioration.

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2. Key Vital Signs

Metric	2024 (£)	Interpretation
Net Current Assets	-2,176	Negative working capital; more short-term obligations than short-term assets - a symptom of liquidity stress.
Total Assets Less Current Liabilities	-2,146	Negative value indicates liabilities exceed assets, pointing to insolvency risk.
Shareholders’ Funds (Equity)	-2,146	Negative equity reflects accumulated losses or undercapitalization, a critical red flag.
Debtors	17,040	Consistent amounts due from related parties; relatively small and stable.
Current Liabilities	19,216	Rising short-term payables, including director’s current accounts, increasing the liquidity burden.
Fixed Assets	30	Minimal fixed asset base, indicating limited long-term tangible resources.

Interpretation:

• The persistent negative net current assets indicate the company is living "payday to payday," with limited buffer to meet short-term obligations.
• Negative shareholders’ funds signal the company’s capital base is eroded, comparable to a patient with weakened immune defenses.
• The company relies heavily on director loans (£17,270) to fund operations, showing dependence on internal financing rather than external or operational cash flows.

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3. Diagnosis

Underlying Business Health:
ANDREAS HOLDINGS LIMITED, as a holding company, has minimal operational assets and has accumulated losses reflected in negative equity. The financials reveal symptoms consistent with a company in early-stage distress:

• Liquidity Stress: Negative working capital means the company may struggle to pay debts as they fall due without additional financing.
• Capital Deficiency: Negative shareholders’ funds suggest that the company has been operating at a loss or has insufficient capital injection from shareholders.
• Reliance on Director Loans: The significant director’s account creditor balance shows dependence on owner funding to sustain operations.

Contextual Factors:

• The company is newly incorporated (2022) and may still be in the investment or development phase typical for holding companies with minimal trading.
• No audit was required or performed, which is common for small companies but means financial statements have not undergone external verification.

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4. Recommendations

To improve financial wellness and avoid worsening financial distress, the company should consider the following actions:

1. Capital Injection:

   • Infuse new equity capital to restore positive shareholders’ funds, which would strengthen the company’s financial foundation and improve creditor confidence.

2. Improve Liquidity Management:

   • Manage current liabilities carefully; consider negotiating extended payment terms with creditors or restructuring director loans to reduce short-term pressure.
   • Convert some director loans to equity if feasible, improving working capital ratios.

3. Operational Review:

   • As a holding company, review the performance and cash flows of subsidiary investments to ensure they contribute positively to the group’s financial health.
   • Explore opportunities to increase income or reduce expenses to generate positive cash flows.

4. Regular Financial Monitoring:

   • Establish monthly cash flow forecasts and financial reviews to detect emerging symptoms of distress early.
   • Consider engaging a financial advisor to assist with turnaround strategies if financial conditions do not improve.

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