GARETH YATES PROPERTIES LTD

Executive Summary

Gareth Yates Properties Ltd, a newly incorporated real estate agency, currently shows signs of financial distress with negative net assets and working capital, indicating liquidity challenges. While compliant with filings and operational, the company needs immediate focus on improving cash flow, managing costs, and potentially injecting capital to stabilize its financial health and build a sustainable foundation for growth.

GARETH YATES PROPERTIES LTD - Analysis Report

Company Number: 15042547

Analysis Date: 2025-07-29 15:41 UTC

Financial Health Assessment for Gareth Yates Properties Ltd

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1. Financial Health Score: D

Explanation:
The company is currently in a precarious financial position, exhibiting negative net assets and net current assets, which are key indicators of financial distress. While it is still operational and not overdue on filings, the balance sheet shows signs that urgent financial management is necessary to restore stability.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Fixed Assets	852	Very minimal investment in long-term assets
Current Assets	375	Very low liquid resources
Current Liabilities	3,005	Debts due within one year exceed current assets significantly
Net Current Assets	-2,630	Negative working capital — indicates liquidity strain
Total Assets Less Current Liabilities	-1,778	Negative, showing liabilities exceeding assets
Creditors Due After One Year	50	Small long-term debt
Accruals and Deferred Income	1,020	Significant accrued expenses/liabilities
Net Assets (Shareholders Funds)	-2,848	Negative equity indicating accumulated losses or undercapitalization

Interpretation:

• "Healthy cash flow" is absent: The company has far more short-term debt than liquid assets, a classic symptom of liquidity distress.
• Negative net assets ("net liabilities") indicate that the company's total obligations exceed its total resources, a serious warning sign.
• The very low fixed assets suggest the company is asset-light, typical in real estate agencies focused on services rather than property ownership.

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3. Diagnosis

The financial "symptoms" point to an early-stage company with limited capital base and strained liquidity. Given the company was incorporated in August 2023 and the accounts are for the first year ending July 2024, this negative net asset position may reflect startup losses or initial operating expenses not yet offset by revenue.

• The "negative working capital" (net current assets) is the most critical symptom, indicating difficulty meeting short-term obligations without external funding or improved cash inflows.
• Negative shareholders' funds imply the company is either underfunded or has incurred losses, which may affect stakeholder confidence and creditworthiness.
• However, no overdue filings or legal distress (liquidation/administration) are present, suggesting the company is still operational and compliant.

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4. Recommendations

To remedy the financial distress symptoms and improve health:

1. Improve Liquidity:

   • Inject additional capital or secure short-term financing to cover immediate liabilities.
   • Expedite collection of receivables and manage payables carefully to improve cash flow.

2. Cost Control:

   • Review and reduce non-essential expenses to conserve cash.
   • Monitor accruals and deferred income to avoid unexpected cash demands.

3. Revenue Growth:

   • Focus on increasing sales or service contracts to generate positive operating cash flow.
   • Consider marketing or strategic partnerships to boost client base.

4. Financial Monitoring:

   • Implement regular cash flow forecasting to anticipate liquidity issues early.
   • Engage with financial advisors or accountants to plan for sustainable growth.

5. Equity Strengthening:

   • Consider equity funding options to improve net asset position and provide a buffer against losses.
   • Retain earnings as the company becomes profitable to rebuild reserves.

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Executive Summary