CUMBRAVEN PROPERTY INVESTMENTS LTD

Executive Summary

Cumbraven Property Investments Ltd shows a strong liquidity position but faces significant challenges due to negative equity and heavy long-term debt. The company’s financial health requires urgent attention to restructure liabilities and improve capital to avoid worsening distress. Immediate focus on debt management and profitability enhancement will be critical for sustainable recovery.

CUMBRAVEN PROPERTY INVESTMENTS LTD - Analysis Report

Company Number: 12828683

Analysis Date: 2025-07-20 15:19 UTC

Financial Health Assessment for CUMBRAVEN PROPERTY INVESTMENTS LTD (As at 31 August 2024)

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1. Financial Health Score: D

Explanation:
The company exhibits signs of financial strain primarily due to negative shareholders' funds and significant long-term liabilities relative to assets. While current assets have grown, they remain insufficient to cover total liabilities comfortably. The score reflects a condition requiring close monitoring and financial restructuring to restore health.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Fixed Assets	87,114	Stable investment in long-term assets—foundation of business value
Current Assets	347,982	Increased liquidity pool; positive sign but not fully liquid
Current Liabilities	582	Very low short-term liabilities—good for immediate obligations
Creditors (Due after 1 year)	434,614	Heavy long-term debt burden—major concern for financial stability
Shareholders Funds (Equity)	-454	Negative equity signals financial distress or accumulated losses
Net Current Assets	~347,400	Strong working capital, indicating ability to meet short-term debts
Average Employees	0	No staff costs—low operating expenses but also no human resource base

Interpretation of Vital Signs:

• Healthy Cash Flow Indicator: The company has a strong current asset base relative to current liabilities, indicating "healthy cash flow" or short-term liquidity.
• Symptoms of Distress: Negative equity and large long-term creditors suggest "chronic financial stress," possibly due to financing structure or unprofitable operations.
• Stability of Fixed Assets: Fixed asset values are stable, showing no impairment or disposals, indicating steady investment in property or premises.

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3. Diagnosis

• Balance Sheet Weakness: The company’s negative shareholders’ funds (equity) position is a critical symptom of financial distress. Essentially, liabilities exceed assets, indicating the company is "under water" financially. This raises concerns about solvency if conditions worsen.
• Debt Burden: Heavy long-term creditors suggest reliance on debt financing, which may be putting pressure on cash reserves due to interest and principal repayments. This "financial strain" could exacerbate if income or asset values decline.
• Liquidity vs Leverage: Despite this debt, the company maintains a strong liquidity position with current assets far exceeding current liabilities, which is a "positive vital sign." It suggests the company can cover short-term debts but may struggle with long-term obligations.
• Operational Footprint: With zero employees, the company likely operates with minimal overhead, possibly outsourcing or automated operations, which reduces fixed costs but may limit growth capacity.
• Micro Entity Status: Filing as a micro entity limits reporting complexity but also means limited financial transparency; however, the figures available reveal the core financial challenges.

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4. Recommendations

1. Capital Restructuring:
   Consider equity injections or debt restructuring to improve shareholders’ funds. Negative equity is a red flag that may limit future borrowing and investor confidence.

2. Debt Management:
   Engage with creditors to explore refinancing options or extended maturities to reduce pressure on cash flows.

3. Profitability Enhancement:
   Analyze revenue streams and operating costs to improve profitability, ensuring the company generates enough surplus to reduce liabilities over time.

4. Cash Flow Monitoring:
   Maintain rigorous cash flow forecasting to ensure short-term liquidity remains healthy, avoiding any symptoms of cash distress.

5. Strategic Asset Review:
   Assess fixed assets for possible sale or revaluation to bolster cash reserves or reduce debt.

6. Stakeholder Communication:
   Transparently communicate financial conditions with shareholders and lenders to build trust and facilitate cooperative solutions.

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