CDI LOGISTICS LTD

Executive Summary

CDI LOGISTICS LTD exhibits clear financial distress characterized by negative net assets and zero cash reserves, signaling liquidity and capital deficiencies. Despite some reduction in liabilities, urgent action to improve cash flow, reduce costs, and restructure debt is necessary to stabilize and restore financial health. Without intervention, the company risks escalating financial difficulties.

CDI LOGISTICS LTD - Analysis Report

Company Number: 13619405

Analysis Date: 2025-07-29 15:57 UTC

Financial Health Assessment of CDI LOGISTICS LTD
As of the financial year ended 30 September 2024

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1. Financial Health Score: D

Explanation:
The company shows clear symptoms of financial distress. Negative net assets and working capital deficits indicate an unhealthy financial state. While not at immediate risk of insolvency, the balance sheet reveals ongoing losses and insufficient liquidity to comfortably meet short-term obligations. Improvement is necessary to restore financial wellness.

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2. Key Vital Signs

Metric	2024 (£)	Interpretation
Net Current Assets	-4,030	Negative working capital; current liabilities exceed current assets indicating liquidity strain.
Net Assets (Equity)	-4,030	Shareholders’ funds are negative; company owes more than it owns—sign of capital erosion.
Cash at Bank	0	No available cash to cover immediate expenses; a red flag for cash flow health.
Current Liabilities	4,030	Short-term debts that must be settled soon; manageable but close to total asset base.
Employees	1	Very small operation; limited human resource capacity to expand or absorb shocks.
Trend vs Prior Years	Net Assets improved from -6,679 (2023) to -4,030 (2024) but still negative; cash reduced to zero.	Some improvement in equity but liquidity worsening due to zero cash balance.

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3. Diagnosis: What the Numbers Reveal

• Liquidity Crisis Symptoms: The company’s working capital is negative, and cash reserves have depleted entirely by 2024. This "drying up of cash flow" poses risks to daily operations and meeting creditor demands.
• Capital Deficiency: Negative net assets indicate shareholders' funds have been eroded, likely due to accumulated losses. This is akin to a patient with a weakened core organ (equity) struggling to sustain life.
• Small Scale and Limited Resources: With only one employee and minimal assets, the company has limited capacity to generate rapid revenue growth or absorb financial shocks.
• Signs of Stabilisation: The reduction in net liabilities from 2023 to 2024 shows some management effort to reduce debts or improve operations, but the absence of cash suggests ongoing liquidity challenges.
• No Audit Requirement & Small Company Regime: Filing under the small companies exemption may mean less detailed scrutiny, but also potentially less transparency on operational challenges.

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4. Recommendations: Steps to Improve Financial Wellness

• Boost Liquidity Immediately: Secure short-term financing or inject capital to restore positive cash flow. Healthy cash reserves are vital to smooth operations and creditor confidence.
• Cost Control & Profit Improvement: Review expenses and operations to improve profit margins. Even small improvements in profitability will help stop equity erosion.
• Creditor Negotiation: Engage creditors to extend payment terms or restructure debt. Reducing short-term liabilities will ease working capital pressure.
• Monitor Cash Flow Closely: Implement rigorous cash flow forecasting and management to avoid unexpected shortages.
• Consider Strategic Review: Evaluate business model viability and consider diversification or partnerships to increase revenue streams.
• Regular Financial Reporting: Maintain up-to-date financial records and consider voluntary audits or reviews to enhance transparency and stakeholder trust.
• Long-term Capital Injection: If possible, seek equity investment to restore shareholders’ funds and strengthen the balance sheet "immune system."

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Medical Analogy Summary:

CDI LOGISTICS LTD currently suffers from "financial anemia" — a deficiency of capital and liquidity akin to low blood levels weakening the body's functions. While there are early signs of "recovery," the absence of vital "energy" (cash) means the company risks further deterioration unless urgent "treatment" (capital injection and cash management) is administered.

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