Company Number: 12577515

Analysis Date: 2025-07-29 16:50 UTC

Financial Health Assessment Report for AVIS ELECTRICAL LTD
Assessment Date: June 2025
Industry: Electrical Installation (SIC 43210)
Company Category: Micro Private Limited Company
Director & Principal Owner: Mr Michael Lloyd Avis

---

1. Financial Health Score: B

Explanation:
AVIS ELECTRICAL LTD demonstrates a solid foundation with positive net assets and working capital over the past five years. The company maintains a stable financial position with net assets consistently above £30,000, which is healthy for a micro-entity. However, a slight downward trend in net assets and fixed assets over recent years, coupled with limited scale (single employee), suggests moderate caution is warranted. The score B reflects good financial health but with areas for improvement to ensure ongoing vitality.

---

2. Key Vital Signs

Metric	2024 (£)	Interpretation
Fixed Assets	15,027	Moderate investment in long-term assets; decreased from prior years indicating possible asset disposals or depreciation.
Current Assets	25,924	Healthy short-term resources, mainly cash/debtors; slight decrease from previous years but still strong.
Current Liabilities	6,875	Low short-term obligations relative to assets, indicating good liquidity and ability to meet immediate debts.
Net Current Assets (Working Capital)	19,451	Positive and increasing working capital; a sign of good operational liquidity and "healthy cash flow".
Net Assets (Shareholders’ Funds)	33,778	Positive equity indicating the company is "financially solvent" with assets exceeding liabilities.
Share Capital	2	Nominal share capital typical for micro-entities; equity is mainly accumulated reserves.
Employee Count	1	Small workforce consistent with micro-entity status; operational scale is limited but focused.

---

3. Diagnosis

• Liquidity & Cash Flow (Vital Signs): The company exhibits strong liquidity, with net current assets significantly positive. This is analogous to a patient having a strong pulse – indicating the business can comfortably cover short-term debts without stress.

• Asset Management (Symptoms Analysis): The decline in fixed assets from £28,179 in 2020 to £15,027 in 2024 suggests asset usage or disposal, possibly reflecting business scaling or efficiency improvements. It's important to monitor if this impacts operational capacity.

• Capital Structure & Solvency: The company maintains positive net assets throughout, indicating the business is solvent and not over-leveraged. This is akin to a patient with stable vital organ function.

• Profit Retention & Reserves: Shareholders' funds mostly comprise retained earnings, which is a positive symptom implying the company retains profits to support growth and cushion downturns.

• Scale & Growth Potential: With only one employee and micro-entity classification, growth prospects depend heavily on the director’s capacity and market conditions. Limited diversification may pose risk if demand falls.

• Governance & Control: The sole director and 100% owner is Mr Michael Lloyd Avis, an electrician by profession. This simplifies decision-making but also concentrates risk and responsibility.

---

4. Recommendations

• Maintain & Monitor Cash Flow: Continue regular monitoring of working capital to ensure the company remains liquid, particularly if growth plans require investment or hiring.

• Asset Strategy Review: Evaluate the fixed asset base to ensure it supports current and future business needs. Consider if asset disposals were strategic or forced by financial constraints.

• Business Development: Explore opportunities to expand client base or services to increase revenue, diversifying risk beyond a single-person operation.

• Financial Reporting: Although exempt from audit, consider voluntary external review or advisory support to identify hidden financial risks and optimize tax planning.

• Succession & Governance Planning: Develop contingency plans for management continuity, given the central role of the sole director.

• Cost Control: Continue prudent management of liabilities to avoid financial distress symptoms such as overdue payables or cash shortages.

---

Summary

AVIS ELECTRICAL LTD currently enjoys a "healthy" financial state, with strong liquidity, positive net assets, and solid reserves for a micro-entity. The company shows no urgent symptoms of financial distress but should proactively manage its asset base and growth strategy to ensure long-term vitality. Careful stewardship of cash flow and operational scale will be key to maintaining this good health.