FREMMA LTD

Executive Summary

FREMMA LTD is currently in a fragile financial state, marked by severe liquidity shortages and negative equity despite substantial fixed assets. Immediate steps to improve cash flow, restructure liabilities, and potentially inject capital are critical to avoid insolvency risks. Without intervention, the company's financial health may deteriorate further.

FREMMA LTD - Analysis Report

Company Number: 13048397

Analysis Date: 2025-07-20 11:13 UTC

Financial Health Assessment for FREMMA LTD

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1. Financial Health Score: D

Explanation:
FREMMA LTD shows significant financial distress, primarily due to liquidity issues and negative net assets. Despite holding substantial fixed assets, the company’s current liabilities far exceed its current assets, indicating a "symptom of distress" akin to an "impaired circulatory system" in a patient where cash flow is severely restricted. The persistent negative shareholders’ funds over multiple years confirm ongoing financial strain.

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2. Key Vital Signs (Financial Metrics):

Metric	Value (2023)	Interpretation
Fixed Assets	£482,878	Healthy asset base (long-term investments or property)
Current Assets	£374	Extremely low liquid assets ("low blood volume" in finances)
Current Liabilities	£494,579	Very high short-term obligations ("high blood pressure")
Net Current Assets (Working Capital)	£-494,205	Severe working capital deficit - liquidity crisis
Total Assets Less Current Liabilities	£-11,327	Negative net assets indicating insolvency risk
Shareholders’ Funds	£-11,327	Negative equity; capital erosion over time
Average Employees	Nil	No staff employed, possibly indicating non-operational status or outsourcing

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3. Diagnosis:

FREMMA LTD is exhibiting classic symptoms of financial distress:

• Liquidity Crisis: The company's current liabilities dwarf its current assets, indicating it may struggle to meet short-term obligations. This is a critical symptom akin to a patient with poor blood circulation — operations may be starved of necessary cash flow.

• Negative Equity: Persistent negative shareholders’ funds reflect accumulated losses or undercapitalisation. This condition suggests the company is "running a deficit" that erodes the owners' stake and could lead to solvency concerns.

• Asset-Liability Mismatch: While fixed assets are substantial, the company’s inability to convert these quickly to cash (illiquid assets) points to a risk if creditors demand payment imminently.

• No Employees: The absence of employees could mean either the company is in a holding pattern, is inactive operationally, or relies entirely on contractors or directors without payroll — this might reduce operational expenses but also signifies limited business activity.

Overall, FREMMA LTD’s financial health is compromised. The company is akin to a patient with a weakened heart (negative equity) and poor circulation (liquidity issues), requiring urgent intervention to restore financial wellness.

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4. Recommendations:

• Improve Liquidity: Consider restructuring short-term liabilities or negotiating extended payment terms with creditors to ease immediate cash flow pressures. Injecting working capital can stabilize the "circulatory system."

• Asset Utilization: Explore options to monetize or refinance fixed assets to generate cash. This could involve selling non-core assets or leveraging property holdings.

• Capital Injection: The owners or external investors could provide additional equity to restore positive net assets, which will strengthen the balance sheet and reduce insolvency risk.

• Operational Review: Evaluate business model viability given no employees and persistent losses. Consider cost rationalisation or pivoting activities to improve revenue generation.

• Professional Advice: Engage turnaround specialists or insolvency advisors early to develop a recovery plan, preventing the "medical emergency" of formal insolvency procedures.

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