ARC SUBSEA INTL LIMITED

Executive Summary

ARC SUBSEA INTL LIMITED is currently showing signs of financial distress, with negative net assets and working capital deficits indicating liquidity and solvency challenges. Immediate action to improve capital structure and cash flow management is essential to avoid further deterioration. Enhanced financial monitoring and operational review will be key to restoring financial health.

ARC SUBSEA INTL LIMITED - Analysis Report

Company Number: 12876933

Analysis Date: 2025-07-29 14:47 UTC

Financial Health Assessment of ARC SUBSEA INTL LIMITED

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1. Financial Health Score: D

Explanation:
The company shows persistent negative net assets over the last three years, indicating that liabilities exceed assets—a clear symptom of financial distress. While the firm maintains small fixed assets and current assets, these are insufficient to cover short-term creditors, resulting in negative working capital. This financial profile places ARC SUBSEA INTL LIMITED in a vulnerable position, warranting close monitoring and corrective action.

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2. Key Vital Signs

Metric	2024 (£)	Interpretation
Fixed Assets	67	Minimal investment in long-term assets; typical for a micro-entity.
Current Assets	12,444	Cash or near-cash resources available. Healthy cash equivalents are crucial but limited in scale here.
Current Liabilities	13,545	Short-term obligations exceed current assets, indicating liquidity pressure.
Net Current Assets (Working Capital)	-1,100	Negative working capital—symptom of potential difficulty meeting short-term debts.
Net Assets (Total Equity)	-1,033	Negative net assets, indicating the company owes more than it owns; cause for concern.
Profit & Loss Reserve	Not reported	Micro-entity accounts exempt this disclosure; inability to assess retained earnings limits insight into profitability.
Employee Count	0	No staff employed, possibly indicating limited operational activity or reliance on contractors/outsourcing.

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3. Diagnosis

ARC SUBSEA INTL LIMITED exhibits classic symptoms of a company in the early stages of financial strain:

• Negative Net Assets: The company’s liabilities surpass its asset base, indicating that it is technically insolvent on a balance sheet basis. This is an important red flag often linked to accumulated losses or undercapitalization.

• Negative Working Capital: Current liabilities exceed current assets, suggesting the company may face challenges in meeting short-term obligations without raising additional funds or converting non-current assets to cash.

• Minimal Fixed Assets & No Employees: The company’s asset base is negligible and it employs no staff, which may imply limited operational scale or a business model heavily reliant on external resources.

• Lack of Profit and Loss Data: The absence of a profit and loss account (not mandatory for micro-entities) restricts insight into operational profitability, cash generation, and expense structure, making it harder to fully assess financial health.

• No Signs of Liquidation or Receivership: Despite financial stress indicators, the company remains active and compliant with filings, suggesting ongoing attempts to stabilize or grow.

Overall, the company is in a precarious financial condition, with symptoms pointing towards possible distress if corrective measures are not implemented.

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4. Recommendations

To restore financial health and improve sustainability, consider the following actions:

• Strengthen Capital Base: Injection of equity or debt financing to eliminate negative net assets and improve solvency ratios—think of this as providing the company with a “vitamin boost” to restore financial vitality.

• Improve Working Capital Management: Negotiate longer payment terms with creditors or accelerate receivables collection to alleviate liquidity stress; akin to stabilizing blood pressure to improve circulation.

• Operational Review: Examine the business model and cost structure—without employees, the company may rely on contractors or outsourcing; optimize these arrangements to enhance profitability.

• Prepare and Monitor Profit & Loss Statements: Even if not mandatory, tracking income and expenses will provide crucial “health indicators” to detect early symptoms of financial distress and adjust strategy accordingly.

• Engage Professional Advice: Consult with financial advisors or turnaround specialists to diagnose underlying issues and design a recovery plan, much like a medical specialist guiding treatment of chronic conditions.

• Regular Financial Monitoring: Establish key performance indicators (KPIs) and schedule frequent reviews to detect and address emerging financial symptoms promptly.

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