CRESCENT UTILITIES LTD

Executive Summary

Crescent Utilities Ltd exhibits a sound financial position for a startup, with positive net assets and healthy working capital indicating good liquidity and no debt burden. While the company is in an early stage with limited operating history, it shows promising financial "vital signs" that suggest stability and growth potential. Careful cash flow management and strategic reinvestment will be key to maintaining and improving its financial wellness moving forward.

CRESCENT UTILITIES LTD - Analysis Report

Company Number: 14858811

Analysis Date: 2025-07-29 19:51 UTC

Financial Health Assessment of Crescent Utilities Ltd

---

1. Financial Health Score: B

Explanation: Crescent Utilities Ltd demonstrates a solid start as a newly incorporated company with positive net assets and healthy working capital. The balance sheet shows good liquidity and a strong equity base relative to its size and age. However, with only one year of trading history and modest fixed assets, the company is still in early development and needs to build operational track record and cash flow consistency. Hence, a grade B reflects a "generally healthy but early stage" financial condition.

---

2. Key Vital Signs

Metric	Value (£)	Interpretation
Fixed Assets (Net)	24,842	Moderate investment in plant and vehicles; depreciating assets signals ongoing capital use.
Current Assets	56,557	Includes cash and debtors; healthy liquidity pool for operations.
Cash at Bank	29,392	Sufficient cash buffer for near-term obligations; a "healthy pulse" for liquidity.
Debtors	27,165	Amount owed by customers; manageable but should be monitored for collection efficiency.
Current Liabilities	34,827	Obligations due within a year, including tax liabilities; requires careful cash flow management.
Net Current Assets	21,730	Positive working capital, indicating the company can cover short-term debts "comfortably".
Net Assets / Shareholders Funds	46,572	Strong equity base relative to size; indicates no over-reliance on debt financing.
Share Capital	100	Minimal initial capital contribution, typical for startups.
Profit & Loss Reserve	46,472	Accumulated retained earnings or reserves; signals initial retained profitability or capital injection.

---

3. Diagnosis: What the Financial Data Reveals

Crescent Utilities Ltd is a young, active private limited company operating in a niche civil engineering sector. The company has started with a modest capital base and has invested in tangible assets like machinery and vehicles, essential for its operations.

• Liquidity and Cash Flow: The company shows a healthy cash reserve (£29,392) and positive net current assets (£21,730), suggesting it can cover its short-term obligations without strain. This is a critical "healthy heartbeat" of the business.

• Capital Structure: The net assets of £46,572, all equity-financed, indicate no debt burden, which reduces financial risk and interest obligations but may limit growth capacity initially.

• Receivables and Creditors: Debtors are balanced against creditors, but the significant tax and social security liabilities (£28,122) require vigilant cash management to avoid future "symptoms of distress" such as late payments or penalties.

• Operational Stage: As the company is only about one year old, it's in the "incubation" phase of business development. The relatively small asset base and limited workforce (2 employees) reflect startup scale rather than mature operations.

• Profitability: Although profit and loss details are not disclosed, the positive reserves suggest the company is not in loss, which supports a stable financial condition.

• Risk Factors: The company must ensure it maintains its cash flow and manage working capital carefully, especially given tax liabilities and the cyclical nature of construction projects.

---

4. Recommendations: Specific Actions to Improve Financial Wellness

1. Enhance Cash Flow Monitoring: Maintain close oversight of debtor collections and creditor payments to ensure liquidity remains strong, especially to meet tax obligations timely.

2. Build Capital Reserves: Consider increasing share capital or securing low-cost financing to support expansion of fixed assets and operational capacity as business grows.

3. Implement Credit Control Policies: Establish clear terms with customers to reduce debtor days and improve cash inflows, avoiding over-extension of credit.

4. Plan for Tax Payments: Set aside funds regularly to cover tax liabilities to prevent cash flow shocks and penalties that can weaken financial health.

5. Invest in Operational Efficiency: As assets depreciate, plan for reinvestment in machinery and vehicles to sustain service quality and competitive positioning.

6. Regular Financial Reviews: Conduct quarterly financial health checks to detect early "symptoms" of financial stress, enabling proactive management.

7. Strategic Growth Planning: Develop a business plan targeting revenue growth and diversification within the civil engineering sector to build resilience.

---