Company Number: 14194926

Analysis Date: 2025-07-20 18:27 UTC

Financial Health Assessment: Gliders Swimming Ltd (as of 30 June 2024)

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1. Financial Health Score: D

Explanation:
The company shows several symptoms that indicate financial distress. While it remains active and solvent, its working capital is negative, net assets are minimal, and cash reserves have decreased year-on-year. The overall financial position suggests caution is warranted.

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2. Key Vital Signs

Metric	2024 Value	2023 Value	Interpretation
Fixed Assets	£2,959	£4,191	Small asset base, declining; indicates limited capital investment.
Current Assets	£17,519	£13,709	Increased, driven mainly by debtors rising sharply.
Cash	£6,865	£10,683	Decreasing cash balance signals potential liquidity concerns.
Debtors	£10,654	£3,026	Significant increase; risk of slow payments or collection issues.
Current Liabilities	£19,866	£17,173	Rising short-term obligations increase pressure on liquidity.
Net Current Assets (Working Capital)	-£2,347	-£3,464	Negative and slightly improved; signals short-term liquidity stress.
Net Assets	£102	£193	Very low equity base; fragile financial cushion.
Shareholders' Funds	£100	£100	No increase in share capital; minimal buffer for losses.

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3. Symptoms Analysis (What the Numbers Reveal)

• Negative Working Capital: The company’s current liabilities exceed current assets by £2,347, a ‘symptom’ of tight liquidity and potential difficulty in meeting short-term obligations without additional financing or cash inflows. The slight improvement from 2023’s -£3,464 is positive but still concerning.

• Declining Cash Reserves: Cash has dropped by over 35% year-on-year, from £10,683 to £6,865. This signals either increased spending or delays in collecting receivables (debtors).

• Rising Debtors: Debtors have more than tripled, from £3,026 to £10,654. This may indicate customers are taking longer to pay or larger sales on credit, which can strain cash flow.

• Minimal Net Assets and Equity: Net assets are just £102, which is extremely low and close to insolvency territory. The company has very little financial ‘resilience’ to absorb losses or shocks.

• Loans to Director and Related Party Transactions: There is a director loan balance (£2,393) and significant related party balances (£8,260 due from related company). While these can be normal, heavy reliance on director advances or inter-company receivables can obscure true liquidity.

• Small Asset Base: Fixed assets have decreased and represent a small part of total assets, indicating little long-term investment or collateral.

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4. Diagnosis: Overall Financial Condition

Gliders Swimming Ltd displays symptoms of financial strain, particularly liquidity stress. Negative working capital combined with declining cash and rising receivables suggests cash flow is tight and the company may struggle to meet immediate obligations without injecting fresh capital or improving collections.

The company’s equity position is extremely weak, providing minimal financial cushion. This fragile balance sheet means the company is vulnerable to operational setbacks or unexpected expenses.

However, the company is still operational, not in liquidation or administration, and has met filing deadlines, which is a positive sign of compliance and ongoing business activity.

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5. Prognosis: Future Financial Outlook

If current trends continue—rising debtors, negative working capital, shrinking cash—the company may face increasing liquidity problems in the near term. Without improvements in cash flow management or capital injection, the risk of distress or insolvency may increase.

Conversely, if the company can tighten credit control, convert debtors to cash faster, and manage liabilities prudently, it can stabilize and improve its financial health.

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6. Recommendations: Actions to Improve Financial Wellness

• Improve Cash Flow Management: Accelerate debtor collections by tightening credit terms and actively chasing overdue payments to convert receivables into cash. Consider incentives for early payment.

• Manage Current Liabilities: Negotiate extended payment terms with suppliers or creditors to ease immediate pressure on cash.

• Strengthen Equity Base: Consider injecting additional capital to bolster net assets and provide a financial buffer.

• Monitor and Limit Related Party Balances: Ensure director loans and inter-company transactions are transparent, documented, and monitored to avoid liquidity risks.

• Review Cost Structure: Analyze expenses to identify and reduce unnecessary costs, improving overall cash burn rate.

• Regular Financial Monitoring: Implement monthly cash flow forecasts and working capital reviews to detect and address issues early.

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