Company Number: 13114684

Analysis Date: 2025-07-20 12:14 UTC

Financial Health Assessment of COLLEDGE TREE & LANDSCAPE LTD

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1. Financial Health Score: C

Explanation:
The company shows a moderate financial position typical of a young micro-entity in a capital-intensive service sector. It demonstrates growth in net assets but suffers from persistent negative working capital (net current liabilities). This reveals liquidity stress symptoms, although fixed assets and shareholder funds are increasing, indicating capital investment and retained equity building. The score reflects some caution due to current liabilities exceeding current assets, but no immediate distress or insolvency signs.

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2. Key Vital Signs

Metric	2024 (£)	Interpretation
Fixed Assets	230,366	Healthy investment in long-term assets suggests capital base growth and operational capacity.
Current Assets	32,959	Relatively low; mostly short-term cash or receivables—insufficient to cover short-term debts.
Current Liabilities	103,306	High short-term obligations causing working capital deficit, indicating liquidity stress or tight cash flow.
Net Current Assets	-70,347	Negative working capital is a symptom of financial strain; may affect ability to meet short-term commitments timely.
Creditors (Long-term)	106,276	Significant long-term debt; manageable if cash flow supports servicing these obligations.
Net Assets (Equity)	52,034	Positive and growing equity base signals overall solvency and retained earnings accumulation.
Share Capital	102	Minimal, typical for micro companies; most capital appears to be retained earnings or asset revaluation.
Average Employees	1	Very small workforce consistent with micro business scale.

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3. Diagnosis: What the Numbers Reveal

• Liquidity Symptoms: The company displays symptoms akin to a patient with restricted blood flow—negative net current assets indicate that its short-term liabilities outstrip liquid resources. This could lead to cash flow bottlenecks and difficulties in meeting immediate financial obligations, which is a key warning sign to monitor.

• Capital Structure: The firm has a strong fixed asset base relative to its size, reflecting investment in equipment or property necessary for landscape services. This is a positive indicator of operational capability and long-term viability.

• Profit Retention: The increase in net assets from £31,617 in 2023 to £52,034 in 2024 suggests the company has been able to retain earnings or increase asset values, a sign of underlying profitability or capital appreciation.

• Operational Scale: With only one employee and micro-entity status, the company is in an early growth phase or a tightly controlled operation, which can limit risk but also restrict revenue potential.

• No Signs of Insolvency: Despite liquidity pressures, the company is not in liquidation or administration and filings are up to date, indicating compliance and operational continuity.

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4. Recommendations: Steps to Improve Financial Wellness

1. Improve Working Capital Management:

   • Accelerate collection of receivables and manage payment terms with suppliers to reduce the net current liabilities gap.
   • Consider short-term financing solutions such as overdrafts or invoice factoring to ease liquidity strain.

2. Enhance Cash Flow Forecasting:

   • Routinely monitor cash inflows/outflows to anticipate potential liquidity crunches early, akin to regular health check-ups to catch symptoms before they worsen.

3. Optimize Asset Utilization:

   • Ensure fixed assets are generating adequate revenue; disposing of underutilized assets could release cash to improve liquidity.

4. Explore Revenue Growth Strategies:

   • With a small workforce, consider scaling operations carefully to increase turnover without compromising financial stability.

5. Maintain Compliance and Governance:

   • Continue timely filing of accounts and confirmation statements to avoid penalties that could add financial stress.

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