EXO CONSULTING LTD

Executive Summary

EXO CONSULTING LTD shows strong financial health with solid liquidity, growing equity, and sound working capital management typical of a well-managed micro-entity in IT consultancy. The company has overcome previous director loan dependency, signaling improved financial discipline. Continued focus on cash flow monitoring and prudent financial planning will support sustainable growth and resilience.

EXO CONSULTING LTD - Analysis Report

Company Number: 12766746

Analysis Date: 2025-07-20 18:38 UTC

Financial Health Assessment for EXO CONSULTING LTD

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1. Financial Health Score: A-

Explanation:
EXO CONSULTING LTD demonstrates a strong financial position typical of a healthy micro-entity. The company shows robust net current assets, increasing net assets year-over-year, and positive shareholder equity. The cash-like current assets far exceed short-term liabilities, indicating excellent liquidity and working capital management. The minor reduction in fixed assets is not a concern given the company's consultancy nature, which tends to be asset-light.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Fixed Assets	365	Very low, consistent with consultancy business
Current Assets	229,759	Strong liquidity reserve, healthy cash flow
Current Liabilities	74,561	Manageable short-term obligations
Net Current Assets	155,198	Excellent working capital buffer
Net Assets / Shareholders’ Funds	155,563	Growing equity base, signals profitability and retention of earnings
Director Advances	(2,300)	Director has repaid a significant portion of previous advances, positive sign of financial discipline
Average Employees	1	Small, focused operation typical for micro category

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3. Diagnosis: What the Numbers Reveal

• Liquidity and Cash Flow Health: The company’s current assets more than double its current liabilities, indicating a "healthy cash flow" environment. This ensures the company can meet its debts as they fall due without stress.
• Asset-light Model: Fixed assets are minimal, consistent with the IT consultancy sector where intellectual capital is the main resource rather than physical assets.
• Capital Structure: The net assets (equity) have grown from approximately £56,700 at incorporation in 2020 to £155,563 in 2024, showing consistent profitability or capital injections. This "healthy equity cushion" reduces financial risk.
• Working Capital: Positive and increasing net current assets reflect good management of receivables, payables, and cash.
• Director Advances: The director owed a significant amount in 2023 (£31,828.97), which has been largely repaid in 2024 (£2,299.71 remaining). This "symptom of distress" from prior years has improved, indicating better cash discipline and reduced reliance on director loans.
• Operational Scale: With only 1 employee and a micro-entity account category, the company is likely a small, owner-managed business with lean operations.

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4. Recommendations for Financial Wellness Improvement

• Maintain Strong Liquidity: Continue to monitor working capital to sustain the positive gap between current assets and liabilities. Avoid over-investment in fixed assets which are not critical to the business model.
• Manage Director Advances Carefully: Keep director loans minimal and ensure repayments are timely to avoid cash flow strain or potential conflicts in financial reporting.
• Enhance Profit Retention: Explore opportunities to increase retained earnings to build further financial resilience and fund future growth.
• Plan for Growth: As the company grows, consider formal budgeting and cash flow forecasting to anticipate seasonal fluctuations or investment needs.
• Regular Financial Reviews: Periodic financial health checks can catch early warning symptoms such as increasing liabilities or cash conversion delays.
• Compliance and Reporting: Stay up to date with filing deadlines to avoid penalties and maintain good governance.

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