FE ELECTRICAL SOLUTIONS LTD

Executive Summary

FE Electrical Solutions Ltd is financially stable with positive net assets and working capital, reflecting a healthy short-term liquidity position. However, a decline in fixed assets and equity suggests cautious scaling or mild financial contraction. Focused asset management and profitability monitoring are recommended to strengthen financial resilience and support sustainable growth.

FE ELECTRICAL SOLUTIONS LTD - Analysis Report

Company Number: 13441982

Analysis Date: 2025-07-29 20:03 UTC

Financial Health Assessment of FE Electrical Solutions Ltd (as of 30 June 2024)

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1. Financial Health Score: B-

Explanation:
FE Electrical Solutions Ltd demonstrates a generally stable financial position with positive net assets and working capital. However, there are signs of slight contraction in asset base and equity, indicating some mild financial stress or business scaling back. The micro-entity status limits the detail available, but on available data, the company is financially stable yet not robustly growing.

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2. Key Vital Signs

Metric	2024	2023	Interpretation
Net Assets (Shareholders’ Funds)	£21,746	£26,187	Healthy positive equity, but reduced by ~17% year-on-year, possibly indicating asset disposals or retained losses.
Net Current Assets (Working Capital)	£11,263	£13,280	Positive working capital signals liquidity to meet short-term obligations comfortably. Slight decline suggests some tightening of liquidity.
Fixed Assets	£11,605	£14,089	Decline in fixed assets may indicate disposal, depreciation, or lack of reinvestment — a sign of cautious capital expenditure.
Current Liabilities	£1,146	£5,699	Significant reduction in short-term liabilities is a positive sign, reducing pressure on cash flow.
Share Capital	£1.00	£1.00	Minimal share capital typical of micro private companies; capital structure is simple.
Average Number of Employees	1	1	Very small workforce, consistent with micro entity classification, limiting operational scale.

Additional Observations:

• The company repaid a director loan of £3,097 within the year, which is a positive sign of managing internal financing responsibly.
• The company filed on time, is compliant with filing requirements, and is not under liquidation or distress.

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3. Diagnosis: Financial Health Interpretation

FE Electrical Solutions Ltd shows the vital signs of a "steady but cautious" financial patient. The company maintains healthy liquidity and positive net assets, akin to a patient with stable vital signs but undergoing mild weight loss — here represented by declining equity and asset base. The decline in fixed assets and net assets may reflect strategic downsizing, reduced investment, or early-stage volatility typical for a company only three years old.

The positive working capital and low current liabilities indicate good short-term financial health, suggesting no immediate cash flow distress or insolvency symptoms. The small scale of operations (one employee, low share capital) means the company is likely managing a niche or specialized service, consistent with its SIC code in educational support services.

The lack of an audit, permitted under micro-entity exemptions, means less transparency, but filings appear consistent and timely, indicating good governance for the size.

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4. Recommendations: Actions to Improve Financial Wellness

• Asset Management: Investigate reasons for declining fixed assets; consider reinvestment in essential equipment or technology to support growth and operational efficiency. Avoid excessive asset disposals that may impair future earning capacity.
• Profitability Focus: Though profit and loss data is not available, the decline in net assets suggests monitoring profitability closely. Implement cost controls, pricing strategies, and explore revenue growth opportunities in educational support services.
• Cash Flow Monitoring: Maintain strong liquidity by regularly reviewing receivables, payables, and cash balances to prevent future symptoms of cash flow strain.
• Growth Strategy: Given the micro size, consider strategic partnerships or gradual scaling of workforce and client base to build resilience and broaden operational capacity.
• Financial Reporting: Although audit exemption applies, maintaining internal financial reviews and forecasts will help anticipate financial stress and support decision-making.
• Director Loans: Avoid reliance on director loans for operational financing; seek external financing if needed to maintain clear financial boundaries and reduce risk.

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Executive Summary