BEN'S PIZZERIA LIMITED

Executive Summary

Ben's Pizzeria Limited is a micro-sized, active food takeaway company showing improving financial health but still experiencing liquidity pressures as evidenced by negative working capital. Its net assets are growing, indicating overall solvency, yet cash flow management requires attention to resolve short-term funding strains. With focused cash flow improvements and cautious asset management, the company can strengthen its financial resilience and support sustainable growth.

BEN'S PIZZERIA LIMITED - Analysis Report

Company Number: 13525368

Analysis Date: 2025-07-20 16:28 UTC

Financial Health Assessment Report for Ben's Pizzeria Limited

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1. Financial Health Score: C

Explanation:
Ben's Pizzeria Limited shows mixed financial signals typical of a young, micro-sized business in the take-away food sector. The company maintains positive net assets with modest growth, but persistent negative net current assets ("working capital deficit") signal liquidity challenges. This places it at a "C" grade, indicating fair financial health but with symptoms of strain that require attention to ensure stability and growth.

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2. Key Vital Signs

Metric	2024 Value	Interpretation
Fixed Assets	£34,616	Moderate investment in long-term assets; slightly reduced from prior year, suggesting asset disposals or write-downs.
Current Assets	£15,267	Improved from £4,929 in 2023, indicating better cash or receivables position.
Current Liabilities	£16,755	Slightly decreased from £19,381 in 2023 but still exceeds current assets.
Net Current Assets (Working Capital)	-£1,488	Negative but improved from -£14,452, indicating improved short-term liquidity but still a symptom of potential cash flow stress.
Net Assets (Equity)	£33,128	Strong equity base for a micro business; increased year-on-year, showing retained earnings or capital injection.
Employees	6	Stable staffing level; manageable size for micro entity.

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3. Diagnosis: What the Financial Data Reveals

Ben's Pizzeria Limited is showing signs of recovery from earlier liquidity distress. The working capital deficit has narrowed significantly over the last year, resembling a patient whose vital signs have improved but not yet fully stabilized. The positive and growing net assets indicate the business has capital support and has not eroded shareholder equity, which is a healthy sign.

However, the continued negative working capital is a “symptom” of potential cash flow issues—possibly due to delayed receivables, stock holding, or short-term obligations outpacing liquid assets. This could constrain the company's ability to meet immediate debts and operational expenses without external support or improved cash management.

The fixed assets have decreased slightly, possibly an indication of asset sales, depreciation, or reduced reinvestment, which could reflect cautious capital expenditure or cost-cutting measures.

Overall, the company is solvent with a stable shareholder base (75-100% held by Mrs. Deborah Samari Pirnegh), but the liquidity symptoms need monitoring to avoid cash flow "attacks" that could threaten operational viability.

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4. Recommendations: Steps to Improve Financial Wellness

1. Improve Cash Flow Management

   • Tighten credit control on receivables to reduce cash tied up in unpaid invoices.
   • Negotiate better payment terms with suppliers if possible to extend outflows.
   • Monitor daily cash flow forecasts to anticipate shortages and plan accordingly.

2. Increase Working Capital

   • Consider short-term financing options like an overdraft or invoice factoring to bridge liquidity gaps.
   • Assess inventory levels to avoid excess stock that ties up cash unnecessarily.

3. Asset Utilization Review

   • Evaluate fixed assets for efficiency; consider whether disposals or upgrades could improve operational productivity.
   • Avoid excessive capital expenditure until working capital issues resolve.

4. Profitability Enhancement

   • Review pricing strategy and cost controls to improve margins.
   • Explore new revenue streams or customer segments in the take-away food market.

5. Regular Financial Monitoring

   • Maintain monthly or quarterly financial reviews focusing on liquidity ratios and cash flow trends.
   • Engage professional accounting advice if cash flow symptoms worsen.

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