Company Number: 13635373

Analysis Date: 2025-07-29 12:18 UTC

Financial Health Assessment of BROSELEA LTD

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1. Financial Health Score: D

Explanation:
BROSELEA LTD shows ongoing financial distress indicated by consistent negative net assets and a significant working capital deficit ("net current liabilities"). The company is technically insolvent on a balance sheet basis with liabilities exceeding assets, which is a warning sign ("symptoms of distress"). However, as a micro-entity with limited operational scale and a short trading history, there may be potential for recovery if corrective actions are taken. The score reflects serious financial challenges but not yet terminal condition.

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2. Key Vital Signs

Metric	2024 (£)	Interpretation
Fixed Assets	90,000	Stable non-current asset base, likely property holdings.
Current Assets	9,000	Small cash/debtor balance, low liquidity buffer.
Current Liabilities	132,078	High short-term obligations; cash flow pressure likely.
Net Current Assets	-123,078	Significant working capital deficit; "unhealthy cash flow".
Total Assets Less Current Liabilities	-33,078	Negative net assets; insolvency risk present.
Shareholders Funds	-33,588	Equity is negative, indicating accumulated losses.
Employees	2	Very small workforce; limited operational scale.

Interpretation:

• The large negative working capital signals inability to meet short-term debts from current assets, a critical "vital sign" of financial distress.
• Negative shareholders’ funds indicate accumulated losses and potential erosion of investor confidence.
• Fixed assets remain unchanged, suggesting no impairment but also no growth or reinvestment.
• The company has maintained compliance with filing deadlines, which is good governance but does not offset financial weaknesses.

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3. Diagnosis

BROSELEA LTD is currently in a fragile financial state resembling a patient with chronic illness: the balance sheet reveals persistent deficits and negative equity over multiple years. The "symptoms" highlight liquidity problems—high current liabilities vastly outstrip current assets, risking inability to pay bills and creditors on time. The absence of profit and the ongoing accumulation of losses deepen the negative equity, suggesting the company has not yet reached financial recovery.

The industry—buying and selling of own real estate—typically requires substantial capital and strong cash flow management. The micro-entity status and small employee base suggest a start-up or minimally scaled operation that has yet to generate positive cash flow or profitability.

Director appointments history shows turnover and limited active management presence, possibly reflecting governance instability.

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4. Recommendations

To improve financial wellness and stabilize the company, the following steps are advised:

• Liquidity Management:
  Prioritize reducing current liabilities and improving cash flow. Negotiate payment terms with creditors and consider short-term financing options to bridge liquidity gaps.

• Capital Injection:
  Seek additional equity funding or shareholder loans to shore up negative net assets and restore solvency.

• Cost Control:
  Review and reduce operating expenses rigorously to conserve cash, including evaluating the necessity of fixed costs and employee headcount.

• Strategic Review:
  Analyze core business model viability in the real estate sector. Consider restructuring operations, asset disposals, or pivoting to more profitable activities.

• Governance Strengthening:
  Stabilize management team with committed directors and transparent financial reporting to build stakeholder confidence.

• Professional Advice:
  Engage insolvency practitioners or financial advisors early to explore turnaround options and avoid formal insolvency proceedings.

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