ASHRA AND FAINT LIMITED

Executive Summary

ASHRA AND FAINT LIMITED shows signs of financial distress with a negative net asset position and high leverage, primarily backed by fixed assets. While liquidity is not immediately critical, the capital structure is fragile, requiring urgent attention to equity capital and debt management. Strengthening the balance sheet and enhancing cash flow will be vital to stabilizing the company's financial health.

ASHRA AND FAINT LIMITED - Analysis Report

Company Number: 12703633

Analysis Date: 2025-07-20 15:59 UTC

Financial Health Assessment for ASHRA AND FAINT LIMITED

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1. Financial Health Score: D

Explanation:
The company shows troubling signs of financial distress, particularly a negative net asset position and liabilities exceeding assets. While it holds fixed assets, the significant creditor obligations surpass these, indicating solvency concerns. The minimal share capital and absence of employees further point to a fragile financial footing typical for a micro-entity in an early or transitional stage.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Fixed Assets	180,429	Significant investment in long-term assets, likely property
Current Assets	1,806	Very low short-term liquid assets; limited cash or receivables
Current Liabilities	182,717	High short-term obligations, almost equal to fixed assets
Net Current Assets	1,231	Positive but very small working capital buffer
Creditors > 1 year	(182,717)	Long-term debt nearly equal to fixed assets, creating leverage
Net Assets (Equity)	(1,055)	Negative net worth; liabilities exceed assets
Share Capital	2	Minimal equity base
Employees	0	No staff; likely asset management or holding company

Interpretation:

• The "heart rate" of the company—its liquidity—is weak with current assets dwarfed by short-term liabilities, but net current assets are slightly positive, suggesting some short-term operational buffer.
• The "bones" of the company—fixed assets—are substantial, but they are heavily leveraged through creditors falling due after more than one year, indicating debt financing of these assets.
• Negative net assets is a strong symptom of financial distress, implying the company owes more than it owns.
• Absence of employees hints the company may be a property holding entity or investment vehicle with minimal ongoing operations.

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3. Diagnosis

ASHRA AND FAINT LIMITED appears structurally fragile from a financial health perspective. The company has invested heavily in fixed assets but funded these primarily through long-term creditors, creating a high leverage scenario. The negative net asset position is akin to a patient with "organ failure"—the business owes more than it owns, which is a critical symptom.

The small positive net current assets indicate that short-term liquidity is not immediately alarming, but the balance sheet shows a stressed capital structure. The lack of employees and minimal share capital suggests the company’s business model may be passive, such as property leasing or holding, rather than active trading.

Given the company is still active and not in liquidation or administration, it may be managing to service its debts and maintain operations, but the underlying financial structure is precarious.

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4. Recommendations

To improve financial wellness and stabilize the company's "health," the following steps are advisable:

• Capital Injection: Increase equity capital to improve net asset position and reduce insolvency risk. This is akin to strengthening the immune system by adding fresh resources.
• Debt Restructuring: Negotiate terms with creditors to reduce long-term liabilities or extend repayment profiles, alleviating financial strain.
• Improve Liquidity: Build up current assets (cash or receivables) to increase working capital and ensure short-term obligations can be comfortably met.
• Operational Review: Assess if the company can generate operating income from its assets or if it relies solely on financing. Consider developing revenue-generating activities to improve cash flow.
• Financial Monitoring: Implement regular financial health checks to monitor liquidity ratios, solvency, and cash flow to catch any emerging symptoms early.

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