BC PLASTERING CONTRACTS (N.I.) LIMITED

Executive Summary

BC PLASTERING CONTRACTS (N.I.) LIMITED shows stable short-term liquidity but is burdened by high long-term debt, leading to negative net assets—a sign of financial distress. Immediate focus on debt restructuring and cash flow management is essential to restore balance sheet health and avoid insolvency risks. With timely intervention, the company can stabilize and improve its financial condition.

BC PLASTERING CONTRACTS (N.I.) LIMITED - Analysis Report

Company Number: NI678059

Analysis Date: 2025-07-20 11:36 UTC

Financial Health Assessment: BC PLASTERING CONTRACTS (N.I.) LIMITED

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1. Financial Health Score: D

Explanation:
The company shows symptoms of financial distress, primarily due to a negative net asset position as at the latest year-end (2024). While the business has maintained a micro-entity status and a stable number of employees, the significant long-term liabilities relative to assets and declining net assets indicate potential solvency issues that need urgent management attention.

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2. Key Vital Signs (Core Financial Metrics & Interpretation)

Metric	2024 Value (£)	2023 Value (£)	Interpretation
Fixed Assets	42,075	37,500	Slight increase in long-term asset base, indicating investment or acquisition of property/equipment.
Current Assets	201,544	251,822	Decline of ~20% in liquid and short-term assets, potentially signaling deteriorating cash or receivables.
Current Liabilities	59,117	68,282	Current debts slightly reduced but still significant.
Net Current Assets (Working Capital)	142,427	183,540	Healthy working capital but decreased by ~22%, showing less short-term buffer.
Creditors due after 1 year (Long-term liabilities)	200,000	200,000	Large long-term debt burden remains unchanged, creating a substantial fixed obligation.
Net Assets (Shareholders’ Funds)	-15,496	21,042	Shifted from positive to negative net assets, indicating liabilities now exceed assets—a critical warning sign.
Number of Employees	2	2	Stable workforce size, suggesting consistent operational scale.

What these numbers indicate:

• The company’s current assets cover short-term liabilities well, implying it can meet immediate obligations — a "healthy pulse" in liquidity terms.
• However, the substantial long-term debt (£200k) compared to total assets causes net assets to flip negative, a "symptom of distress" akin to a weakened heart struggling under excess weight.
• The reduction in current assets and net current assets signals a potential tightening of cash flow or collection issues.
• The slight increase in fixed assets is positive but minor compared to liabilities.

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3. Diagnosis: Overall Financial Condition

BC PLASTERING CONTRACTS (N.I.) LIMITED currently faces a precarious financial position. The company's balance sheet reveals a "critical symptom"—negative net assets due to large long-term liabilities. While short-term liquidity appears sufficient, the long-term solvency is compromised. This situation resembles a patient with stable vital signs but underlying chronic illness requiring treatment.

The company’s inability to reduce or restructure its long-term debt is the primary driver of this condition. Persisting in this state risks insolvency if cash flows deteriorate further or if creditors demand repayment. The micro-entity status suggests limited scale, which may constrain the company’s ability to access additional capital or refinance debt.

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4. Recommendations: Actions to Improve Financial Wellness

• Debt Restructuring: Engage with creditors to negotiate longer repayment terms, reduced interest, or partial debt forgiveness to alleviate the heavy long-term liability burden.
• Cash Flow Management: Tighten control over receivables and payables to improve current assets and working capital further. Consider implementing stricter credit policies or accelerated invoicing.
• Cost Control: Review operational expenses to ensure the fixed cost base matches the business scale, protecting profit margins and cash reserves.
• Asset Utilisation: Evaluate fixed assets for potential sale or leaseback arrangements to free up cash without undermining operations.
• Financial Monitoring: Establish monthly financial reporting and forecasting to detect early symptoms of distress and to manage liquidity proactively.
• Seek Professional Advice: Consult insolvency or restructuring specialists to explore options if financial conditions worsen. Early intervention improves prognosis.
• Growth Strategies: Explore new contracts or markets to increase revenue streams, improving the "heart strength" through higher income.

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