BALMER PROPERTY LTD

Executive Summary

BALMER PROPERTY LTD shows significant financial distress with negative net assets and severely negative working capital, indicating liquidity and solvency challenges typical of early-stage companies investing heavily in fixed assets. Immediate actions including capital infusion, debt restructuring, and enhanced cash flow management are essential to stabilize the business and improve financial health.

BALMER PROPERTY LTD - Analysis Report

Company Number: 14070886

Analysis Date: 2025-07-29 20:16 UTC

Financial Health Assessment of BALMER PROPERTY LTD

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1. Financial Health Score: D

Explanation:
BALMER PROPERTY LTD displays symptoms of financial distress. The company’s net liabilities position, with negative net assets of £3,303, indicates it is currently insolvent on a balance sheet basis. The company’s working capital is deeply negative (£124,788), driven by creditors far exceeding current assets. While the company is newly incorporated (2022) and classified as a micro-entity, these red flags suggest significant liquidity and solvency challenges.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Fixed Assets	121,485	Investment in long-term assets, likely property-related.
Current Assets	1,057	Very low liquid assets available for short-term needs.
Current Liabilities	125,845	High short-term obligations, possibly loans or payables.
Net Current Assets (Working Capital)	-124,788	Negative, indicating inability to cover short-term debts with liquid assets.
Total Net Assets (Equity)	-3,303	Negative, company owes more than it owns—insolvency symptom.
Shareholders’ Funds	-3,303	Reflects accumulated losses or capital deficiency.
Employee Count	0	No staff employed, indicating a lean or dormant operation.

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3. Diagnosis: What the Financial Data Reveals

• Symptoms of Distress:
  The company’s balance sheet shows negative net assets (£3,303), meaning liabilities exceed assets. This is a classic symptom of insolvency, which can lead to difficulties in meeting creditor demands and securing further financing.

• Liquidity Crisis:
  With current liabilities (~£125k) vastly exceeding current assets (~£1k), the company lacks healthy cash flow and working capital to maintain day-to-day operations without external funding.

• Asset Base:
  The fixed assets of £121,485 suggest the company has invested in property or equipment, consistent with its SIC code (real estate letting). However, these assets are illiquid and may not be easily converted to cash to meet short-term obligations.

• Early Stage Growth or Startup Phase:
  Incorporated in April 2022, with no employees and micro-entity status, the company may be in a startup phase. The negative equity could arise from initial borrowing or capital expenditure ahead of revenue generation.

• Risk Factors:
  The financial condition signals risk to creditors and stakeholders. Without improvement, there is a prognosis risk of insolvency proceedings or forced restructuring.

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4. Recommendations: Actions to Improve Financial Wellness

• Improve Liquidity:
  Seek short-term financing or capital injection to cover the large current liabilities and restore positive working capital. This could be through shareholder loans or equity infusion.

• Asset Management:
  Evaluate the fixed assets for potential sales or leveraging (e.g., mortgage or loan secured on property) to generate cash.

• Cost Control & Revenue Generation:
  Develop a clear business plan to ramp up operations and generate income. Consider hiring essential staff to support operations if needed.

• Financial Restructuring:
  Negotiate with creditors to restructure debts, possibly extending payment terms or reducing interest to ease short-term cash flow pressure.

• Regular Financial Monitoring:
  Institute monthly reviews of cash flow and liabilities to detect early warning signs and take corrective action promptly.

• Professional Advice:
  Consult with insolvency practitioners or financial advisors early to explore options before distress worsens.

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Medical Analogy Summary

BALMER PROPERTY LTD currently exhibits "symptoms of financial distress" akin to a patient with low blood pressure and dehydration—its "vital signs" show dangerously low liquidity and negative equity. Without immediate "treatment" in the form of capital infusion and debt restructuring, the prognosis is poor, risking a financial "collapse." Early intervention is critical to restore the company to a "healthy" financial state.

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