ELLEA VISUAL DESIGN LTD

Executive Summary

ELLEA VISUAL DESIGN LTD is in very good financial health with strong liquidity, increasing equity, and manageable liabilities. The company shows solid profitability and a robust cash position, though the sharp drop in trade debtors warrants further review. Continued prudent financial management and careful monitoring of new investments will support sustained growth and financial wellness.

ELLEA VISUAL DESIGN LTD - Analysis Report

Company Number: 13524055

Analysis Date: 2025-07-20 14:00 UTC

Financial Health Assessment for ELLEA VISUAL DESIGN LTD (as of 31 July 2024)

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1. Financial Health Score: A- (Very Healthy)

Explanation:
The company exhibits robust financial "vital signs," with strong liquidity, solid net assets, and clear equity growth. The balance sheet is well-structured, showing a healthy cash position and low current liabilities relative to assets. The score reflects a financially sound company with minor areas to monitor, such as declining debtor levels and the impact of new investments.

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2. Key Vital Signs

Metric	2024 Value	Interpretation
Cash at Bank	£104,044	Very healthy cash reserves, indicating strong liquidity and ability to meet short-term obligations comfortably.
Current Assets	£104,987	Primarily cash, indicating liquid assets readily available.
Debtors	£943	Very low trade debtors compared to prior year (£10,894), suggesting faster collections or fewer sales on credit—potentially positive or a symptom of reduced sales on account.
Current Liabilities	£17,935	Moderate and manageable short-term debts; well covered by current assets (Net Current Assets = £87,052).
Net Current Assets	£87,052	Strong working capital indicating good short-term financial health.
Fixed Assets	£30,388	Increase mainly due to new investments (£30,000) signaling potential growth or diversification.
Net Assets / Shareholders' Funds	£117,440	A growing equity base from £98,792 in 2023 to £117,440 in 2024 shows accumulation of retained profits and overall financial strength.
Profit & Loss Reserves	£117,439	Indicates accumulated profits retained within the business, a positive sign of profitability over time.

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3. Diagnosis

The company’s financial "vital signs" resemble a patient with a strong heart rate and clear lungs—healthy cash flow and a solid balance sheet with no immediate signs of distress. The high liquidity (cash) acts like a strong pulse, ensuring operational flexibility and resilience to unexpected expenses.

The noteworthy reduction in trade debtors—from £9,894 to £720—is akin to a symptom that requires attention: it could mean improved cash collections (good) or reduced sales on credit (potential concern if sales volumes are dropping). The company’s current liabilities have decreased modestly, which alongside strong cash balances, suggests good management of short-term debts.

The large new investment (£30,000 in ‘Other Investments’) is a positive sign of growth initiatives but should be monitored to ensure it yields returns without straining liquidity.

Overall, the company is financially fit, with a net asset increase of nearly £18,600 over one year, showing retained earnings growth and solid equity buildup.

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4. Recommendations

• Monitor Trade Debtors: Investigate the sharp decline in trade debtors. Confirm if this is due to improved payment terms or reduced sales volume. Keeping a healthy level of receivables is important to maintain future sales pipelines.
• Evaluate Investment Performance: Track the return on the £30,000 investment to ensure it contributes positively to profitability and does not become a financial burden.
• Maintain Healthy Cash Flows: Keep the cash reserves strong as a buffer for operational needs and potential growth opportunities.
• Review Tax Liabilities: Corporation tax payable increased slightly; ensure timely tax planning to avoid cash flow strain.
• Growth Strategy: With strong financial footing, consider strategic reinvestment into marketing or expanding client base to drive revenue growth.

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