GENESIS LEISURE GROUP LTD
Executive Summary
Genesis Leisure Group Ltd operates at the intersection of the wholesale intermediate products and construction sectors, both of which are currently challenged by supply chain issues and rising costs. The company exhibits negative net assets and working capital deficits, underperforming typical industry financial health benchmarks for its sectors. As a small private limited entity, it currently occupies a niche or developmental position, facing liquidity challenges that constrain competitive agility amid volatile market conditions.
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This analysis is opinion only and should not be interpreted as financial advice.
GENESIS LEISURE GROUP LTD - Analysis Report
- Industry Classification
Genesis Leisure Group Ltd is classified primarily under SIC code 46760 (Wholesale of other intermediate products) and also includes SIC codes 41201 and 41202, which relate to the construction of commercial and domestic buildings respectively. This places the company at the intersection of the wholesale trade sector and the construction industry. Key characteristics of these sectors include high capital requirements, reliance on supply chain efficiency (wholesale), and sensitivity to economic cycles and regulatory environments (construction). The wholesale sector often operates with tight margins and requires effective working capital management, while the construction sector is known for project-based revenues and exposure to fluctuating demand based on property market conditions.
- Relative Performance
Analyzing Genesis Leisure Group Ltd’s financials reveals persistent net liabilities and negative shareholders’ funds over recent years, with net assets deteriorating from -£8,705 in 2020 to -£4,675 in 2024. Current liabilities exceed current assets (net current liabilities of -£4,675 as of July 2024), signaling liquidity challenges. The company’s cash balance is minimal (£103), while debtors (£16,807) remain relatively steady, indicating outstanding receivables. Compared to typical industry benchmarks, businesses in wholesale and construction generally maintain positive net assets and positive working capital to support ongoing operations and project financing. The negative equity and ongoing working capital deficits suggest Genesis Leisure Group Ltd underperforms standard financial health metrics observed in the sector. However, as a small private limited company incorporated in 2020, it may still be in a developmental or restructuring phase.
- Sector Trends Impact
The wholesale sector has been facing supply chain disruptions, inflationary pressures on input costs, and shifting demand patterns post-pandemic. Similarly, the construction industry in the UK is grappling with rising raw material prices, labor shortages, and increased regulatory scrutiny around sustainability and building standards. These macro trends exert pressure on margins and working capital cycles. For Genesis Leisure Group Ltd, operating across wholesale and construction means exposure to these dual challenges: fluctuating product supply and cost escalations in building materials and labor. Additionally, the construction sector's reliance on project pipelines means any slowdown in commercial or domestic building demand could impact revenue streams. The company’s ongoing net liability position may be exacerbated by these sector-wide cost pressures and competitive market dynamics.
- Competitive Positioning
Genesis Leisure Group Ltd appears to be a niche or early-stage player rather than an established leader in either wholesale or construction sectors. Its small scale and ongoing negative net assets contrast with more established competitors who typically exhibit stronger balance sheets and positive equity positions. The company’s financials suggest limited liquidity and potential difficulties in funding growth or absorbing shocks, which is a weakness relative to industry norms. However, the company may benefit from a focused market segment or specialized product lines within wholesale intermediate goods or specific construction niches. The presence of three directors with professional titles indicates experienced leadership, which could be leveraged to improve operational efficiencies and financial management. To strengthen competitive positioning, Genesis Leisure Group Ltd would need to address its working capital gaps, improve cash flow management, and possibly diversify client base or services to mitigate sector cyclicality.
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