C T GASSON SERVICES LIMITED

Executive Summary

C T Gasson Services Limited demonstrates early signs of financial strain primarily due to negative working capital and limited equity, typical of micro-entities under growth or operational pressures. While recent years show modest recovery in net assets, liquidity issues remain a concern. Strategic focus on cash flow management, cost control, and strengthening equity will be essential to improve the company’s financial health and sustainability.

C T GASSON SERVICES LIMITED - Analysis Report

Company Number: 12475296

Analysis Date: 2025-07-20 19:16 UTC

Financial Health Assessment: C T Gasson Services Limited

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1. Financial Health Score: D

Explanation:
The company exhibits signs of financial strain with persistent negative working capital over recent years and low net assets, although there is a modest recovery in the latest financial year. The micro-entity scale limits the complexity, but the balance sheet vitality is currently weak, signaling caution.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	2022 (£)	Interpretation
Fixed Assets	5,305	1,492	1,492	Growth in fixed assets indicates reinvestment but still small scale.
Current Assets	1,488	2,983	2,983	Declining current assets may signal reduced liquidity.
Current Liabilities	4,359	3,423	3,423	Increasing liabilities raise liquidity risk.
Net Current Assets	-2,871	-440	-440	Negative working capital ("symptom of distress") suggests cash flow pressure.
Total Assets Less Current Liabilities	2,434	1,052	1,052	Slightly improving asset buffer, but still modest.
Net Assets / Shareholders' Funds	1,624	242	242	Low equity base but improving; still fragile.
Share Capital	100	100	100	Minimal capital invested, typical for micro-entity.

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3. Diagnosis

• Liquidity Strain: The company’s negative net current assets indicate that short-term liabilities exceed short-term assets, a classic symptom of liquidity strain. This suggests the company may struggle to meet immediate obligations without additional cash inflows or financing.

• Modest Asset Base: Fixed assets have increased, which is a positive sign of investment in operational capacity. However, the asset base remains small, limiting collateral value and financial flexibility.

• Equity Recovery: Net assets have improved significantly from £242 in 2023 to £1,624 in 2024, indicating some retained earnings or capital injections that have bolstered the financial foundation. Nonetheless, the equity level remains low relative to liabilities.

• Profit & Loss Information Absence: The absence of profit and loss data in the filings limits insight into profitability and operational efficiency. However, balance sheet trends suggest the company has faced operational challenges.

• Cash Flow Concerns: Declining current assets and persistent working capital deficits imply the company may be experiencing "cash flow health issues," which could impair day-to-day operations if not addressed.

• Size and Scale: As a micro-entity with only two employees and minimal share capital, the company is small and likely heavily dependent on the director’s management and credit arrangements.

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4. Recommendations

• Improve Working Capital Management:
  Focus on accelerating debtor collections and negotiating longer payment terms with suppliers to improve the liquidity "vital signs." Consider introducing tighter credit control policies.

• Increase Cash Reserves:
  Building a "healthy cash flow" buffer should be a priority, potentially through additional shareholder loans or capital injections to cover short-term liabilities and reduce liquidity risk.

• Cost Control and Profitability Focus:
  Without detailed P&L data, it is crucial to monitor operational costs rigorously to improve margins and build retained earnings, strengthening net assets.

• Financial Forecasting and Planning:
  Implement regular cash flow forecasting to anticipate and manage cash shortages proactively, avoiding liquidity "symptoms of distress."

• Explore Financing Options:
  If working capital deficits persist, consider short-term financing solutions such as overdrafts or invoice financing, but with careful management to avoid overleveraging.

• Maintain Compliance and Timely Filings:
  Continue ensuring timely submission of accounts and confirmation statements to uphold regulatory standing and avoid penalties.

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