BARNABEE PROPERTY MANAGEMENT LIMITED

Executive Summary

Barnabee Property Management Limited maintains stable net asset growth but faces liquidity challenges due to a persistent working capital deficit. The company's strong fixed asset base provides a solid foundation, yet the negative net current assets highlight short-term cash flow risks. Management should focus on improving liquidity through better cash flow management, debt restructuring, and careful asset utilization to ensure sustainable financial health.

BARNABEE PROPERTY MANAGEMENT LIMITED - Analysis Report

Company Number: 12832705

Analysis Date: 2025-07-20 11:43 UTC

Financial Health Assessment: BARNABEE PROPERTY MANAGEMENT LIMITED

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1. Financial Health Score: C

Explanation:
The company shows signs of being a going concern with positive net assets and modest equity growth. However, the significantly negative net current assets (working capital deficit) signal liquidity stress, indicating that short-term obligations substantially exceed short-term assets. This financial "symptom" suggests the company may struggle to cover immediate liabilities without relying on longer-term financing or asset sales. The overall picture is stable but with cautionary flags around cash flow and short-term financial flexibility.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Net Assets (Equity)	98,164	Positive and increasing equity indicates some retained value and modest growth in shareholder funds. A healthy "blood pressure" of the balance sheet.
Net Current Assets	-247,908	Negative working capital ("unhealthy pulse") signals liquidity issues; current liabilities far exceed current assets. Risk of short-term cash flow strain.
Fixed Assets	495,235	Significant investment in long-term assets, mostly investment property (~£486k). This "long-term organ" is healthy but illiquid.
Cash at Bank	7,070	Low cash reserves relative to current liabilities. "Low oxygen supply" for day-to-day operations.
Current Liabilities	259,459	Substantial short-term debts due within a year; high pressure on liquidity.
Long-Term Liabilities	124,656	Bank loans and other debts falling due after one year; manageable but adds to financial obligations.
Share Capital	1	Nominal share capital; equity growth is mainly from retained earnings or revaluation reserves.

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3. Diagnosis

• Liquidity Distress Symptoms:
  The company exhibits a pronounced working capital deficit (negative net current assets) in the last three years. This means that current liabilities are significantly higher than current assets, posing a risk that the company may face difficulties meeting short-term obligations without refinancing or converting fixed assets into cash. This is a classic sign of potential "cash flow distress."

• Asset Structure & Stability:
  The company’s fixed assets, predominantly investment property, are large and stable in value, recorded at fair value (£485,860). These assets provide a solid foundation ("structural strength") but are not easily liquidated to meet immediate cash needs. Tangible fixed assets have decreased, reflecting depreciation or disposals.

• Equity Growth:
  The net assets and shareholder funds have improved steadily from a negative position at incorporation to a positive £98k in 2024, indicating "recovery" and retained earnings or revaluation gains. This suggests the company is building a stronger financial footing over time.

• Revenue & Profitability:
  No profit and loss details are provided, but the absence of dividends or further capital injections suggests the company relies on operations and asset revaluation for equity increases. The director’s report notes exemption from audit, so detailed profitability analysis is limited.

• Related Party Transactions:
  A small debtor balance (£4,480) is due from a related company, a common practice but requires attention to ensure these balances are recoverable to avoid liquidity strain.

• Control and Governance:
  Ms Alison Louise Wilford holds 75-100% control and is sole director, which centralizes decision-making but can pose governance risks if not adequately monitored.

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4. Recommendations

• Improve Liquidity Management:
  The company should prioritise increasing current assets relative to current liabilities. This could involve accelerating debtor collections, negotiating extended payment terms with creditors, or securing short-term financing. Think of this as restoring a "healthy heartbeat" in the cash flow.

• Cash Flow Forecasting:
  Implement robust cash flow forecasting to predict and manage liquidity shortages proactively, avoiding emergency liquidity interventions.

• Asset Utilisation:
  Consider whether some fixed assets (e.g., investment property) can be leveraged (e.g., re-mortgaged) or partially sold to improve liquidity without compromising the core business.

• Debt Restructuring:
  Engage with lenders to negotiate more favourable terms on bank loans or convert some short-term debt to longer maturities to reduce immediate pressure.

• Governance and Controls:
  As a single director company, ensure proper external oversight (accountants, advisors) to maintain financial discipline and transparency, reducing risks of oversight or mismanagement.

• Monitor Related Party Balances:
  Carefully review recoverability of amounts owed from related parties to avoid unexpected cash flow gaps.

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