BELMONT PROJECTS LTD

Executive Summary

Belmont Projects Ltd shows signs of moderate financial health with positive working capital but shrinking cash reserves and equity, signaling liquidity and profitability challenges. Immediate focus on receivables management, cost control, and compliance is essential to prevent financial distress and ensure sustainable business operations.

BELMONT PROJECTS LTD - Analysis Report

Company Number: 12615003

Analysis Date: 2025-07-20 15:16 UTC

Financial Health Assessment for Belmont Projects Ltd

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1. Financial Health Score: C

Belmont Projects Ltd demonstrates a moderate financial position with some signs of stability but also notable symptoms of strain, particularly in liquidity and profitability. The company’s financial condition is fair but not robust, with room for improvement to ensure sustainable growth and resilience against market fluctuations.

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2. Key Vital Signs

Metric	2023 Value (£)	Interpretation
Current Assets	303,984	Adequate short-term assets, primarily debtors and cash, but showing a slight decline from 2022.
Cash Balance	78,948	Cash on hand is modest and has decreased year-on-year, signaling potential tight cash flow.
Debtors	225,036	Significant portion of current assets tied up in receivables; efficiency of collection critical.
Current Liabilities	210,766	High short-term obligations, increased slightly from prior year, may pressure liquidity.
Net Current Assets	93,218	Positive working capital, indicating ability to cover short-term liabilities but with less buffer than prior year.
Net Assets / Equity	94,747	Net asset base has declined from £128,615 in 2022, showing erosion in retained profits/equity.
Share Capital	1.00	Minimal share capital, typical for small private company, does not impact financial strength directly.
Overdue Accounts Filing	Yes	Filing accounts late may indicate administrative or financial management challenges.
Employee Count	1	Very small operational scale, likely founder or key director operated.

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3. Symptoms Analysis

• Liquidity Concerns ("Weak Pulse"): Cash reserves have fallen by approximately 16% from £94k to £79k, while current liabilities have increased. Although net current assets remain positive, the narrowing margin suggests the company’s "cash flow heart" is under strain, potentially risking difficulties in meeting short-term obligations promptly.

• Receivables Concentration ("Lingering Infection"): Over 74% of current assets are debtors (£225k out of £304k), which may indicate extended credit terms or slow collection processes. If customers delay payments, this could exacerbate liquidity issues.

• Erosion of Equity ("Fading Strength"): The drop in net assets/equity by roughly 26% (£128k to £95k) signals accumulated losses or reduced profitability, weakening the company’s financial backbone and its ability to absorb shocks or invest in growth.

• Minimal Fixed Assets ("Lean Skeleton"): Tangible fixed assets are very low (£1,529), consistent with a service or project-based business model but limiting collateral for borrowing or wider operational capacity.

• Operational Scale ("Single Organism"): With only one employee, the company depends heavily on key personnel. This operational concentration could be a risk if key individuals are unavailable.

• Governance and Compliance ("Delayed Check-ups"): Overdue filing of accounts could reflect internal management challenges or cash constraints, potentially undermining stakeholder confidence.

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4. Diagnosis

Belmont Projects Ltd is currently in a "stable but fragile" financial state. The company maintains positive working capital, indicating it can meet immediate obligations, yet the diminishing cash reserves and high debtor reliance are early warning signs of liquidity stress. The shrinking equity base suggests operational profitability is under pressure or that retained earnings have been utilized to cover past losses or working capital needs. The company’s small scale and overdue filings compound these vulnerabilities, placing it at moderate risk if market conditions deteriorate or receivables are not collected timely.

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5. Prognosis (Future Outlook)

If the current trends persist—declining cash balances, high debtor levels, and shrinking equity—the company risks developing financial distress symptoms such as cash flow insolvency or inability to fund operations without external support. However, given the positive net current assets and active status, there is a good chance for recovery if corrective measures are implemented swiftly. Continued careful management of receivables, cost control, and timely compliance with reporting duties will be crucial to improving financial health.

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6. Recommendations

• Improve Cash Management ("Strengthen the Heartbeat"): Implement stricter credit control policies to accelerate debtor collections. Consider offering early payment discounts or enforcing late payment penalties to boost cash inflow.

• Reduce Short-term Liabilities ("Lighten the Load"): Negotiate longer payment terms with suppliers or refinance short-term debts to ease immediate cash pressure.

• Enhance Profitability and Equity ("Build Muscle"): Review pricing strategies, project margins, and overhead costs to improve profitability and rebuild the equity base.

• Compliance and Governance ("Regular Health Check-ups"): Prioritize timely submission of accounts and statutory filings to avoid penalties and maintain good standing with regulators and stakeholders.

• Operational Resilience ("Diversify Vital Organs"): Consider expanding the team or delegating key functions to reduce dependency on a single individual and support sustainable growth.

• Financial Planning ("Preventive Care"): Develop a rolling cash flow forecast and scenario planning to anticipate and mitigate financial risks proactively.

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