EXPERT ELECTRICAL SOLUTIONS LIMITED

Executive Summary

EXPERT ELECTRICAL SOLUTIONS LIMITED is currently in a fragile financial state, with key indicators showing worsening liquidity and solvency. Immediate remedial actions focusing on cash flow improvement, debt management, and capital strengthening are crucial to prevent further deterioration. Without intervention, the company risks significant financial distress that could threaten its ongoing viability.

EXPERT ELECTRICAL SOLUTIONS LIMITED - Analysis Report

Company Number: 12930127

Analysis Date: 2025-07-29 14:44 UTC

Financial Health Assessment for EXPERT ELECTRICAL SOLUTIONS LIMITED

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1. Financial Health Score: D

Explanation:
The company currently exhibits signs of financial distress, reflected by a negative net asset position and net current liabilities in the latest financial year. While it began with a positive but minimal net asset base, its financial position has deteriorated significantly over the last year. This grade indicates urgent attention is needed to restore financial stability.

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2. Key Vital Signs

Metric	2023 (£)	2022 (£)	Interpretation
Current Assets	3,113	4,746	Cash and short-term assets have decreased, indicating reduced liquidity.
Current Liabilities	10,770	4,716	Current debts have more than doubled, increasing short-term financial pressure.
Net Current Assets	-7,657	30	Shifted from slightly positive to significantly negative, indicating working capital deficiency.
Net Assets (Shareholders’ Funds)	-7,657	30	Negative equity means liabilities exceed assets, a key symptom of financial distress.
Share Capital	1.00	1.00	Minimal share capital, typical of a micro-entity.

• Liquidity: The company’s ability to pay short-term obligations has sharply declined, with current liabilities now nearly 3.5 times current assets.
• Solvency: Negative net assets indicate solvency issues; the company owes more than it owns.
• Capital Structure: Reliance on a single director/shareholder suggests limited external capital inflow.
• Employee Base: Average of 1 employee (director) in 2023 implies low operational scale.

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3. Diagnosis

Much like a patient whose vital signs have worsened over a short period, EXPERT ELECTRICAL SOLUTIONS LIMITED shows clear symptoms of financial stress. The rapid increase in current liabilities alongside declining current assets signals potential cash flow problems and difficulty meeting debts as they fall due.

The negative net asset value is a critical "red flag" indicating that the company’s obligations exceed its resources. This level of insolvency often points to either ongoing losses or accumulating unpaid debts.

Given the company’s micro-entity status and recent incorporation in 2020, this financial deterioration within three years could be due to start-up challenges, undercapitalization, or operational inefficiencies.

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4. Recommendations

• Cash Flow Management:
  Immediate focus on improving cash inflows and controlling outflows. This might include accelerating debtor collections, negotiating extended payment terms with creditors, and minimizing unnecessary expenses.

• Debt Restructuring:
  Engage with creditors to restructure short-term liabilities to avoid default and potential insolvency procedures.

• Capital Injection:
  Consider additional equity funding or director loans to bolster working capital and restore positive net assets.

• Operational Review:
  Assess business operations for efficiency improvements, including pricing strategies, cost control, and service delivery optimization.

• Financial Monitoring:
  Implement rigorous monthly financial reviews to detect early warning signs of distress and adjust plans proactively.

• Professional Advice:
  Seek guidance from insolvency practitioners or financial advisors to explore turnaround strategies and avoid formal insolvency risks.

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