EXPLORE CONSULTING GROUP LIMITED

Executive Summary

EXPLORE CONSULTING GROUP LIMITED shows a stable short-term financial position with strong liquidity but is experiencing a decline in net assets and has eliminated fixed assets, which may indicate long-term vulnerabilities. Continued careful asset management and profitability focus are advised to maintain and improve financial wellness.

EXPLORE CONSULTING GROUP LIMITED - Analysis Report

Company Number: NI682817

Analysis Date: 2025-07-20 17:55 UTC

Financial Health Assessment for EXPLORE CONSULTING GROUP LIMITED

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1. Financial Health Score: B

Explanation: The company demonstrates a generally healthy financial position with positive net current assets ("working capital") and net assets over the last financial year. However, a noticeable decline in net assets and the absence of fixed assets in the latest year indicate some potential vulnerabilities. The score "B" reflects stable but cautious financial health, requiring attention to asset management and profitability to maintain resilience.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Fixed Assets	0	18,480	Complete reduction of fixed assets; potential asset disposals or write-offs; needs review.
Current Assets	26,150	7,919	Healthy increase in liquid assets, improving liquidity.
Current Liabilities	12,133	6,960	Increase in short-term obligations; monitor to avoid cash strain.
Net Current Assets	14,017	959	Significant improvement in working capital; healthy short-term financial cushion.
Net Assets (Shareholders’ Funds)	14,017	19,439	Decrease in overall net worth; indicates accumulated losses or distributions exceeding profits.
Average Number of Employees	2	2	Stable headcount; no expansion or contraction in workforce.

Interpretation of Vital Signs:

• Liquidity ("Healthy Cash Flow"): The rise in current assets alongside increased current liabilities results in a net current asset boost, indicating the company currently holds enough liquid resources to meet short-term debts comfortably—a positive "pulse" for operational stability.

• Asset Base ("Structural Health"): The disappearance of fixed assets could be a sign of asset disposal or impairment. Fixed assets often represent the structural foundation of a business (like equipment or property). Their absence may weaken long-term operational capacity or signal a strategic shift requiring investigation.

• Equity Position ("Overall Vitality"): A reduction in shareholders’ funds from £19,439 to £14,017 signals some erosion of the company’s net worth. While still positive, it suggests the company may be experiencing "symptoms of distress" such as reduced profitability or distributions exceeding retained earnings.

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3. Diagnosis

EXPLORE CONSULTING GROUP LIMITED is currently in a stable financial condition with a solid liquidity position, as evidenced by increased net current assets. This "healthy cash flow" indicates the company can cover its short-term obligations without difficulty, reducing immediate financial stress.

However, the complete write-down or disposal of fixed assets raises a "red flag" regarding the company’s long-term operational infrastructure or investment in capital resources. The decline in net assets also points to some "wear and tear" on the company’s financial health, possibly due to operational losses, asset write-offs, or shareholder distributions.

The company remains small (micro-entity) with a consistent workforce size, suggesting a stable but cautious growth trajectory. The director has maintained compliance with filing deadlines, which reflects good governance and operational discipline.

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4. Recommendations

• Review Asset Strategy: Investigate the reasons for the elimination of fixed assets. If assets were sold or impaired, assess whether this was strategic or due to financial necessity. Consider reinvesting in capital assets essential for growth and service delivery to maintain “structural health.”

• Monitor Profitability and Retained Earnings: The reduction in net assets signals potential "symptoms of distress." Review profit and loss trends to ensure the company is generating sustainable profits. If losses persist, develop a plan to reduce costs or increase revenues.

• Maintain Liquidity Management: Continue monitoring working capital closely to safeguard the "healthy cash flow." Avoid rapid increases in short-term liabilities without corresponding asset growth to prevent liquidity strain.

• Strategic Growth Planning: With a stable employee base and micro-entity status, consider gradual scaling up if market conditions permit. Investing in technology or consultancy expertise could enhance competitive positioning.

• Director Oversight and Governance: Ensure ongoing compliance with regulatory requirements and regular financial reviews to detect early "symptoms" of financial distress and act promptly.

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