GENERATOR (ST LEONARDS) LTD

Executive Summary

GENERATOR (ST LEONARDS) LTD exhibits a sound and solvent financial position with positive net current assets and growing equity, reflecting a "B" grade financial health. The company’s financial stability is supported by intra-group balances, typical for its development phase, but it should focus on diversifying cash flow and strengthening external financial resilience. With prudent financial management and diversification, the company's outlook remains stable and capable of supporting its building project activities.

GENERATOR (ST LEONARDS) LTD - Analysis Report

Company Number: 12536448

Analysis Date: 2025-07-29 17:52 UTC

Financial Health Assessment Report for GENERATOR (ST LEONARDS) LTD

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1. Financial Health Score: B

Explanation:
The company demonstrates a solid short-term financial position with positive net current assets and growing shareholders' funds. The "B" grade reflects a generally healthy financial state but with some caution advised due to reliance on intercompany balances and limited asset diversity typical in early-stage development companies.

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2. Key Vital Signs

Metric	Value (2024)	Interpretation
Share Capital	£100	Nominal capital, common in small private companies.
Debtors (Receivables)	£217,558	Significant receivables mainly from group/participating interests, indicating internal group funding or sales.
Current Liabilities	£170,872	Short-term liabilities also primarily to group/participating interests.
Net Current Assets	£46,686	Positive working capital; indicates liquidity to cover current obligations.
Shareholders’ Funds (Equity)	£46,786	Growing retained earnings indicate accumulated profits or capital injections.
Employees	2	Small workforce consistent with micro/small company.

Interpretation:

• The positive net current assets ("healthy cash flow" equivalent) reflect the company’s ability to meet short-term liabilities without distress.
• The large debtor and creditor amounts mainly relate to intra-group balances, suggesting tight financial integration within the group, which can be both a strength (support) and a risk (dependency).
• The nominal share capital and small employee base are typical for a company at an early stage of building projects or development.

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3. Diagnosis

The company's financial "vital signs" show a stable and solvent position as of the 2024 year-end. The positive net current assets and growth in shareholders’ funds suggest the company is not under financial strain ("no symptoms of distress"). However, the company’s assets mainly comprise amounts owed by and to group/participating interests, indicating that liquidity and financial health may be closely linked to internal group transactions rather than external trading activity.

Given the company operates in building project development (SIC 41100), it is likely in an early phase of project execution or funding, which explains the absence of substantial fixed or tangible assets. The balance sheet shows a conservative structure with low external debt, which reduces financial risk but also highlights reliance on group support.

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4. Recommendations

1. Strengthen External Cash Flow:

   • Aim to diversify revenue sources and reduce dependency on intercompany receivables to improve external cash inflows and reduce counterparty risk.
   • Accelerate debtor collections to enhance liquidity.

2. Monitor Related Party Transactions:

   • Maintain transparency and arm's length terms in transactions with group companies to avoid risks of financial contagion and ensure compliance with accounting standards.

3. Build Asset Base:

   • Consider investing in tangible or intangible assets aligned with development projects to improve long-term financial stability and asset-backed financing options.

4. Financial Planning and Forecasting:

   • Implement robust cash flow forecasting to anticipate working capital needs, especially as development projects progress and external liabilities potentially increase.

5. Governance and Reporting:

   • Continue timely filing and compliance to avoid penalties and maintain stakeholder confidence.
   • Consider voluntary audit or review if external stakeholders demand higher financial assurance.

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