Company Number: 12758354

Analysis Date: 2025-07-29 18:57 UTC

Financial Health Assessment for Cable Technology Limited (as of 31 March 2024)

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1. Financial Health Score: D

Explanation:
Cable Technology Limited shows serious signs of financial distress, reflected by significant negative net assets and working capital. While the company remains active, the balance sheet wounds resemble symptoms of critical illness—large liabilities far exceeding assets indicate poor financial health. The score "D" suggests urgent attention is necessary to avoid further deterioration or insolvency risk.

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2. Key Vital Signs (Core Financial Metrics)

Metric	2024 Value (£)	Interpretation
Fixed Assets	141,531	Modest increase; shows investment in longer-term resources.
Current Assets	852,071	Fair level of liquid assets but declining from previous year.
Current Liabilities	5,238,720	Alarmingly high short-term debts, increased sharply from prior year — a critical red flag.
Net Current Assets (Working Capital)	-4,376,570	Negative working capital; company cannot cover short-term debts with current assets—symptom of liquidity strain.
Total Assets Less Current Liabilities	-4,235,039	Reflects overall insolvency on a going-concern basis—assets do not cover immediate liabilities.
Net Assets / Shareholders’ Funds	-4,422,518	Deeply negative equity position; indicates accumulated losses or debt burden outweighing assets.
Average Number of Employees	10	Small workforce consistent with micro entity status.

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3. Diagnosis: What the Financial Data Reveals

• Liquidity Crisis ("Healthy cash flow" absent): The most critical symptom is the large and growing current liabilities (£5.2m), nearly six times the current assets. This negative working capital (-£4.37m) indicates the company may struggle to meet short-term obligations—akin to a patient with dangerously low blood pressure needing immediate intervention.

• Balance Sheet Insolvency: The net liabilities of £4.42m reflect a company whose debts and obligations exceed its assets by a wide margin. This condition is comparable to organ failure in financial terms, meaning the company’s financial foundation is severely compromised.

• Growth in Fixed Assets: Investment in fixed assets has increased (from £72k to £141k), potentially a positive sign that the business is investing for the future. However, this is overshadowed by the imbalance in liabilities.

• Declining Current Assets: A drop in current assets from £947k to £852k while liabilities rise suggests that available liquid resources are being depleted.

• Stable Headcount: The average employee number remained stable, indicating no major workforce changes, but the financial health issues pose risks to operational continuity.

• No Auditor’s Report: As a micro-entity, the company is exempt from audit, but this limits external assurance on financial health, increasing the importance of internal governance.

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4. Recommendations: Specific Actions to Improve Financial Wellness

1. Urgent Cash Flow Management:

   • Conduct a detailed cash flow forecast to identify critical payment dates and prioritize creditor payments.
   • Negotiate extended payment terms with suppliers and creditors to reduce short-term pressure.

2. Debt Restructuring:

   • Engage with lenders and creditors to restructure the £5.2m current liabilities. Consider formal refinancing, payment plans, or debt consolidation to improve liquidity.

3. Cost Control and Operational Efficiency:

   • Review overheads and discretionary spending to preserve cash.
   • Explore options for increasing revenues or monetizing fixed assets if feasible.

4. Capital Injection:

   • Consider raising new equity or shareholder loans to improve net asset position and restore financial stability.

5. Professional Advisory:

   • Seek advice from insolvency practitioners or financial advisors to evaluate going concern status and explore turnaround strategies.

6. Governance and Monitoring:

   • Strengthen financial oversight and reporting to identify symptoms of distress early and act decisively.

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Medical Analogy Summary:

Cable Technology Limited's financial health shows "symptoms of distress" comparable to a patient with critical liquidity and solvency issues—negative working capital and net liabilities suggest the company is "under severe financial strain" and requires immediate intervention to stabilize its condition. Without prompt action, the prognosis risks worsening, potentially leading to insolvency.

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