ELEVEN CONTRACTS LTD

Executive Summary

Eleven Contracts Ltd exhibits healthy early-stage financial indicators with positive net current assets and shareholders' funds, signaling good short-term solvency and capitalisation. However, low cash reserves and a high debtor balance highlight the need for improved cash flow management to avoid liquidity stress. With prudent financial controls and strategic planning, the company is well-positioned for sustainable growth in its niche trades.

ELEVEN CONTRACTS LTD - Analysis Report

Company Number: 15579280

Analysis Date: 2025-07-29 15:53 UTC

Financial Health Assessment Report: ELEVEN CONTRACTS LTD

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1. Financial Health Score: B

Explanation:
Eleven Contracts Ltd is a newly incorporated private limited company with its first financial year ending 31 March 2025. Despite its infancy, the company shows promising financial "vital signs" with a solid net current asset position and positive shareholders' funds. The score B reflects a generally healthy financial position for a start-up, tempered by its very early stage and limited operational history.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Current Assets	10,516	Represents liquid assets and receivables; adequate to cover short-term obligations.
Cash at Bank and in Hand	105	Very low cash balance, could signal tight liquidity or timing of receipts/payments.
Debtors	10,411	High proportion of current assets tied up in receivables ("money owed"); requires efficient collection to maintain liquidity.
Current Liabilities	2,502	Short-term debts; relatively low compared to current assets, indicating good short-term solvency.
Net Current Assets	8,014	Positive working capital ("healthy cash flow cushion") showing ability to meet short-term liabilities.
Intangible Fixed Assets	9,000	Investment in intangible assets (likely franchise rights or similar); amortised over the period, indicating asset utilisation.
Shareholders' Funds	17,014	Equity capital and retained earnings; positive net worth signals financial stability at the balance sheet date.
Number of Employees	1	Micro-sized operation; low overhead base but also limited scale and diversification.

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3. Diagnosis: Business Financial Health Overview

• Liquidity & Working Capital: The company holds a strong positive net current asset position (£8,014), which is a vital sign of good liquidity and the ability to cover short-term obligations without distress. However, cash in hand is minimal (£105), indicating that most liquidity is tied up in debtors. This is a symptom to monitor carefully — slow debtor collection could strain cash flow.

• Asset Structure: The company has invested £9,000 in intangible assets (net book value after amortisation), which suggests initial setup costs or franchise rights. This is expected for a start-up but should be monitored for impairment risks if business growth slows.

• Capitalisation and Equity: Shareholders' funds at £17,014 are positive and mainly consist of retained earnings and share capital. This shows the business was well-capitalised at inception and has not yet incurred losses, a healthy sign for a new venture.

• Profit & Loss Insight: The absence of an income statement (common for small companies under exemption) limits detailed profitability analysis. However, the retained earnings balance implies some initial profits or capital injections.

• Operational Scale: With just one employee and a focus on specialized trades (painting, joinery, plastering), the company operates a lean structure. This reduces overhead risk but may limit growth potential until scaling occurs.

• Governance & Control: Control is highly concentrated with one director and sole significant controller (owns 75-100% shares and voting rights). This can facilitate swift decision-making but also poses concentration risk if the director faces issues.

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4. Recommendations for Financial Wellness Improvement

• Improve Cash Reserves: The very low cash balance is a warning sign. Enhance cash flow management by accelerating debtor collections and controlling timing of payments. Consider setting aside a cash buffer to reduce liquidity risk.

• Debtor Management: As £10,411 is tied up in debtors, implement strict credit control policies and regular monitoring of aged receivables to avoid cash flow bottlenecks.

• Plan for Scaling: With only one employee, growth depends on expanding workforce or subcontractors. Develop a scalable financial plan that aligns with operational expansion without overstretching working capital.

• Financial Reporting & Profitability Tracking: Although small entity exemptions apply, consider preparing internal profit and loss statements regularly for better insight into operational profitability and cost control.

• Risk Diversification: Given the narrow operational focus and ownership concentration, explore opportunities to diversify client base and possibly bring in additional management support to mitigate key person risk.

• Maintain Compliance and Timely Filings: Continue to file accounts and confirmation statements on time to avoid penalties and maintain good standing with Companies House.

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