CAMELOT PROJECTS LTD

Executive Summary

Camelot Projects Ltd demonstrates strong short-term liquidity but is currently burdened by significant long-term liabilities leading to negative net assets, signaling financial stress. To improve financial health, the company should focus on restructuring debt, boosting profitability, and tightening cash flow management. Prompt action can stabilize the business and restore a healthy financial position.

CAMELOT PROJECTS LTD - Analysis Report

Company Number: 12718925

Analysis Date: 2025-07-29 19:52 UTC

Financial Health Assessment of Camelot Projects Ltd (as at 31 March 2024)

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1. Financial Health Score: C-

Explanation:
Camelot Projects Ltd currently exhibits signs of financial distress. Despite showing growth in current assets and net current assets, the overall net liabilities position and negative shareholders’ funds result in a below-par rating. The company is not insolvent yet, but warning signals in long-term liabilities and net asset position suggest a cautious outlook.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Fixed Assets	10,895	Small investment in long-term assets, appropriate for a micro construction firm.
Current Assets	61,674	Healthy increase, indicating good liquidity and ability to cover short-term obligations.
Prepayments & Accrued Income	42,000	Significant prepaid expenses or income accrued, requiring careful management of cash flow.
Current Liabilities	14,116	Manageable short-term debts relative to current assets.
Net Current Assets (Working Capital)	89,558	Strong positive working capital, a sign of healthy operational liquidity.
Creditors Due After 1 Year	98,789	Large long-term liabilities compared to assets, a symptom of potential financial stress.
Net Assets / Shareholders’ Funds	-2,141	Negative net assets indicate that total liabilities exceed total assets; a red flag.
Average Number of Employees	2	Small team consistent with micro-entity status.

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3. Diagnosis: What the Numbers Reveal About Business Health

• Healthy Cash Flow Indicators: The company shows a strong positive net current assets position (£89,558), meaning it can cover immediate debts and operational expenses without liquidity strain. This is a good "pulse" for day-to-day financial health.

• Symptoms of Distress - Negative Net Assets: The company’s net assets are negative (-£2,141) due to significant long-term liabilities (£98,789). This means from a balance sheet perspective, the company owes more than it owns, signaling financial strain and potential solvency concerns if the trend continues or worsens.

• Increase in Long-Term Creditors: The jump in creditors due after one year (from £82 in 2023 to £98,789 in 2024) is the main cause of the negative net asset position. This could be due to new loans or deferred payments. While such financing can support growth, it also increases financial risk if not managed prudently.

• Growing Prepayments and Accruals: The notable prepaid expenses and accrued income (£42,000) suggest the company is paying ahead or recognizing income in advance. This requires diligent cash flow management to avoid shortfalls.

• Micro-Entity Status and Scale: As a micro company with only two employees, the scale is small, which means financial shocks can have outsized impacts; resilience depends on careful financial planning and managing liabilities.

• Ownership and Control: The sole director and shareholder, Mr. Thomas Marshall Saxton, maintains full control, which can be advantageous for swift decision-making but also concentrates financial risk.

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4. Recommendations: Specific Actions to Improve Financial Wellness

• Review and Restructure Long-Term Debt: The large increase in long-term creditors is a critical symptom. Engage with lenders to explore refinancing options, extend payment terms, or reduce debt burden to restore balance sheet health.

• Improve Profitability and Retain Earnings: Focus on increasing operating profits to rebuild reserves and move net assets back into positive territory. This could entail optimizing project pricing, controlling costs, or expanding client base.

• Cash Flow Management: Monitor prepayments and accruals carefully to avoid cash shortages despite apparent liquidity. Implement rolling cash forecasts to anticipate timing mismatches.

• Financial Reporting and Forecasting: Given the micro status, maintain rigorous monthly financial reviews to catch early warning signs and track progress on debt reduction and profitability.

• Contingency Planning: Prepare a plan for adverse scenarios such as project delays or unexpected expenses to ensure survival under stress conditions.

• Explore Equity Injection: If feasible, an additional capital injection from the owner or external investors could shore up the balance sheet and provide a financial buffer.

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Medical Analogy Summary

Camelot Projects Ltd’s financial “pulse” shows healthy short-term liquidity (“good cash flow”), but the “symptoms” of a weakened “heart”—manifested as negative net assets due to high long-term debt—indicate underlying distress. Without intervention to reduce liabilities and improve “nutritional intake” (profitability), the company risks financial “illness” progressing to insolvency. Immediate “treatment” through debt restructuring and cash flow vigilance is advised for recovery.

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