CODA COMMERCE PROPERTY LTD

Executive Summary

CODA COMMERCE PROPERTY LTD shows stable growth with positive net assets and profitability, indicating solid financial health. However, its significant long-term debt to related parties presents moderate risk, suggesting a need for debt management and liquidity improvement. With focused financial discipline, the company’s outlook remains cautiously optimistic.

CODA COMMERCE PROPERTY LTD - Analysis Report

Company Number: 12826305

Analysis Date: 2025-07-20 14:59 UTC

Financial Health Assessment for CODA COMMERCE PROPERTY LTD

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1. Financial Health Score: B-

Explanation:
The company shows stable net asset growth and maintains positive shareholders’ funds, which are good signs of financial wellness. However, the company carries a substantial long-term liability primarily in the form of loans owed to associated parties, which poses a moderate financial risk. The liquidity position, while positive, reflects limited working capital relative to total liabilities, indicating some strain in short-term financial flexibility.

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2. Key Vital Signs

Metric	Latest Value (£)	Interpretation
Net Assets	143,091	Positive and growing net assets indicate building equity and financial stability.
Shareholders’ Funds	143,091	Mirrors net assets, confirming equity backing.
Current Assets	34,246	Includes cash and debtors; small but sufficient to cover short-term liabilities.
Current Liabilities	19,870	Low current liabilities relative to assets reflect manageable short-term obligations.
Net Current Assets	14,376	Positive working capital, though modest, shows ability to cover immediate debts.
Long-term Liabilities	832,073	Significant debt mainly owed to related party, representing a long-term financial burden.
Cash	24,742	Healthy cash reserves for day-to-day operations but needs monitoring against liabilities.
Profit for Year	53,588	A positive profit contributes to strengthening retained earnings and equity.

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3. Diagnosis

• Healthy Signs:
  CODA COMMERCE PROPERTY LTD demonstrates a "healthy pulse" in terms of steadily increasing net assets and positive retained earnings, indicating profitability and growth in shareholder value. The presence of cash on hand and positive working capital suggests the company can meet its short-term obligations without distress.

• Symptoms of Financial Strain:
  The company carries a very high level of long-term liabilities (£832k), predominantly owed to a related company jointly owned by the directors. This indicates reliance on associated party financing, which, while flexible, may present risks if the lending terms change or if external financing is needed. The current liabilities have decreased compared to prior years, which is good, but the overall debt structure remains heavily skewed towards long-term debt.

• Liquidity and Solvency:
  The company’s liquidity (ability to pay short-term bills) is positive but tight — net current assets of £14,376 is a narrow margin. Solvency (overall ability to meet long-term obligations) is sound given positive net assets, but the large debt load requires careful management to avoid stress.

• Operational Considerations:
  The company’s activity is classified under SIC 96090 ("Other service activities not elsewhere classified"), suggesting a possibly niche or specialized operation. The rental income from a related company (£48,000) shows intercompany transactions that support operations but may pose risks if the related party faces difficulties.

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4. Recommendations

• Debt Management:
  Explore restructuring or reducing the long-term loan balance to improve financial leverage and reduce interest or repayment risk. Consider negotiating repayment terms or seeking alternative financing to diversify debt sources and reduce concentration risk.

• Improve Working Capital:
  Although current assets cover short-term liabilities, aim to build a stronger buffer by increasing cash reserves or accelerating debtor collections to enhance liquidity and operational flexibility.

• Monitor Related Party Transactions:
  Ensure that intercompany loans and rental agreements are at arm’s length terms to avoid regulatory or tax complications, and to safeguard against risks stemming from concentration of financial dependencies.

• Financial Reporting and Transparency:
  Continue timely and complete filing of accounts and confirmation statements to maintain compliance and provide stakeholders confidence.

• Profitability Focus:
  Maintain or improve profitability by managing costs and exploring opportunities to increase revenue streams beyond related party transactions to strengthen independence and financial resilience.

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Medical Analogy Summary

CODA COMMERCE PROPERTY LTD displays a generally stable "heartbeat" with positive net assets and profits, indicating good "organ function." However, the company exhibits "symptoms of financial strain" due to its heavy reliance on long-term loans from related parties, which acts like a chronic condition requiring ongoing management. Strengthening liquidity and reducing debt are akin to improving the patient's lifestyle and medication to ensure long-term health and avoid potential financial "complications."

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