ARINE PROPERTIES LIMITED

Executive Summary

ARINE PROPERTIES LIMITED shows solid financial footing with healthy working capital and stable asset holdings typical of a micro property management company. The principal concern lies in its high level of long-term debt relative to equity, which creates financial leverage risk. With prudent management of cash flow and steps to strengthen equity, the company is well-positioned for sustainable growth.

ARINE PROPERTIES LIMITED - Analysis Report

Company Number: 13617434

Analysis Date: 2025-07-20 13:27 UTC

Financial Health Assessment of ARINE PROPERTIES LIMITED

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1. Financial Health Score: B-

Explanation:
ARINE PROPERTIES LIMITED demonstrates a generally stable financial position with positive net assets and improving working capital, indicating a reasonably healthy financial "pulse." However, the company's heavy reliance on long-term liabilities and relatively modest equity base suggest some underlying vulnerabilities, akin to an individual with stable vitals but early signs of strain.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Fixed Assets	214,761	Significant investment in long-term assets (likely property). Healthy sign for a property management business.
Current Assets	23,974	Adequate short-term resources (cash/debtors).
Current Liabilities	(1,349)	Low current liabilities, suggesting manageable short-term debts. Negative figure here indicates a net creditor position or prepayments.
Net Current Assets	22,625	Positive working capital—strong "cash flow health." Able to cover short-term obligations comfortably.
Total Assets Less Current Liabilities	237,386	Reflects total assets after covering short-term liabilities; a solid asset base.
Creditors (Long-term)	(221,032)	Large long-term liabilities, likely mortgage or loans on properties; a key stress point.
Net Assets (Equity)	15,574	Positive but relatively low equity compared to assets and liabilities; indicates leverage.
Equity Growth (2023 to 2024)	+5,765	Equity nearly doubled, showing retained earnings or capital injection, a positive sign.
Average Employees	2	Small team supports micro-business classification.

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3. Diagnosis

ARINE PROPERTIES LIMITED exhibits the financial characteristics typical of a micro-sized property management entity. The company’s "heart"—its assets—are substantial and stable, centered on fixed assets likely representing property holdings. The "circulatory system"—working capital—is healthy, with positive net current assets and low short-term liabilities, indicating no immediate liquidity "symptoms of distress."

However, the company's financial "lungs"—long-term liabilities—are heavily burdened by substantial creditor balances (£221k), which implies significant debt servicing obligations. The equity base, while positive, remains thin relative to the debt load, suggesting that the company relies heavily on borrowed funds to finance its operations and assets. This financial leverage increases the risk profile, especially if market conditions or rental income fluctuate.

The steady increase in net assets over recent years indicates some retained profitability or owner investment, which is a good sign of ongoing financial "wellness." The absence of overdue filings adds to the confidence that the company is compliant and managing its administrative health effectively.

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4. Recommendations

• Strengthen Equity Base: Consider strategies to increase shareholder funds, such as capital injections or retaining more profits, to reduce financial leverage and improve resilience against market volatility.
• Monitor Debt Servicing: Closely track cash flows to ensure the company can meet interest and principal repayments on long-term liabilities without stress.
• Improve Cash Flow Forecasting: Maintain healthy liquidity by forecasting cash inflows and outflows rigorously, ensuring the company remains free of "cash flow blockages."
• Asset Utilization Review: Periodically assess the performance of fixed assets (properties) to verify they generate sufficient returns and consider asset disposals if underperforming.
• Cost Management: Keep operating expenses under control given the small size of the team and business to protect profit margins.
• Contingency Planning: Develop plans for potential economic downturns or property market shifts, as high debt levels can exacerbate financial distress.

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