E&E MATHEW LIMITED

Executive Summary

E&E MATHEW LIMITED shows financial strain marked by negative working capital and slightly negative net assets, indicating liquidity and capital challenges typical for a micro real estate business. While not in critical distress, the company needs to improve cash flow management and strengthen equity to ensure sustainable operations. Prompt financial restructuring and tighter controls are recommended to restore financial health.

E&E MATHEW LIMITED - Analysis Report

Company Number: 13639234

Analysis Date: 2025-07-29 20:04 UTC

Financial Health Assessment Report for E&E MATHEW LIMITED

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1. Financial Health Score: D (At Risk)

Explanation:
The company shows signs of financial strain with net liabilities and negative working capital. Although it is still active with no overdue filings, the balance sheet reveals symptoms of financial distress that could threaten ongoing operations if not addressed. Immediate attention is needed to improve liquidity and capital structure.

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2. Key Vital Signs

Metric	2024 Value	Interpretation
Fixed Assets	£590,000	Stable investment in long-term assets.
Current Assets	£9,437	Very low liquid assets to cover short-term obligations.
Current Liabilities	£539,186	High short-term debts creating liquidity pressure.
Net Current Assets (Working Capital)	-£529,749	Negative; indicates inability to meet short-term debts with current assets.
Creditors due after 1 year	£61,757	Medium-term liabilities further strain resources.
Net Assets (Equity)	-£1,506	Negative equity; liabilities exceed assets slightly.
Share Capital	£201.50	Minimal equity base limits financial flexibility.

Additional Notes:

• The company operates in real estate activities, which generally require significant capital and stable cash flows.
• The average number of employees is 1, typical for a micro-entity but limits operational scale.
• Shareholders include two directors with roughly equal control, which may aid decision-making agility.

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3. Diagnosis: What the Financial Data Reveals

The financial "vital signs" reveal a company struggling with liquidity and capital adequacy. The negative working capital (net current assets) is a critical symptom—a "weak pulse" indicating that short-term liabilities dramatically outweigh liquid assets. This suggests the company may face difficulties in meeting immediate financial obligations without obtaining additional financing or converting fixed assets into cash.

The fixed asset base is healthy, indicating investment in property or equipment, consistent with its real estate business classification. However, the large current liabilities suggest these assets may be heavily leveraged or the company is under pressure to service short-term debt.

Negative net assets (equity) signal "underlying weakness"—the company owes more than it owns on a net basis. Although the deficit is small (-£1,506), the trend has slightly improved from the previous year (-£20,235), showing some stabilization but still not a "healthy balance sheet."

The low share capital indicates a limited equity cushion to absorb losses or fund expansion, increasing financial vulnerability.

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4. Recommendations: Specific Actions to Improve Financial Wellness

• Improve Liquidity:

  • Explore options to increase current assets, such as collecting receivables faster or increasing cash reserves.
  • Negotiate longer payment terms with creditors to reduce current liabilities pressure.

• Strengthen Capital Structure:

  • Consider injecting additional equity capital to improve net assets and provide a buffer against financial shocks.
  • Assess opportunities to refinance short-term debts into longer-term obligations to ease working capital strain.

• Asset Utilization:

  • Review fixed assets for potential sale or leaseback arrangements to raise cash without losing operational capacity.
  • Optimize the rental or sale of real estate holdings to generate steady income streams.

• Cost Control and Operational Efficiency:

  • Monitor and reduce unnecessary expenses given the micro-entity scale.
  • Ensure tight cash flow management and budgeting discipline.

• Strategic Financial Planning:

  • Engage with a financial advisor or accountant to develop a robust financial recovery plan.
  • Monitor financial health metrics regularly to detect early warning signs of distress.

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Medical Analogy Summary:
E&E MATHEW LIMITED currently exhibits symptoms akin to a patient with a compromised cardiovascular system—while the "organs" (fixed assets) are intact, the "blood flow" (liquidity) is poor, and the "heart" (equity) is weakened. Without intervention to improve cash flow and strengthen capital, the company risks financial "collapse." However, early signs of stabilization offer hope if corrective steps are taken promptly.

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