GLOME SERVICES LIMITED

Executive Summary

GLOME SERVICES LIMITED is currently in a financially fragile state with minimal working capital and equity, signaling risks of liquidity distress. While operational and compliant, the company must urgently improve cash flow management, strengthen its capital base, and control costs to stabilize and enhance financial health. Without intervention, the company faces challenges to sustainable operations.

GLOME SERVICES LIMITED - Analysis Report

Company Number: SC686100

Analysis Date: 2025-07-29 20:03 UTC

Financial Health Assessment: GLOME SERVICES LIMITED

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1. Financial Health Score: D

Explanation:
The company's financial position shows signs of fragility and distress. Despite being active and compliant with filing deadlines, its net assets have dramatically declined from a positive £8,388 in 2023 to just £1 in 2024. Current liabilities have surged, nearly matching current assets, leaving almost no working capital buffer. This thin margin places the company in a vulnerable state, akin to a patient with critical but stable vital signs—functional but at risk without intervention.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Current Assets	45,640	Healthy increase suggesting improved liquidity or cash/resource holdings compared to prior years.
Current Liabilities	45,639	Almost equal to current assets, indicating tight liquidity with very little cushion for obligations.
Net Current Assets (Working Capital)	1	Critically low working capital; company can barely cover short-term debts. A symptom of financial strain.
Net Assets (Equity)	1	Near zero equity signals depleted retained earnings or possible losses eroding shareholder value.
Share Capital	1	Minimal equity base; company likely reliant on external funding or creditors for operations.
Average Number of Employees	1	Very small operation, consistent with micro-entity status but limits operational scale and revenue potential.

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3. Diagnosis

GLOME SERVICES LIMITED presents a financial profile characteristic of a micro-entity with limited capital and very tight liquidity. The balance sheet shows a near break-even position between assets and liabilities, leaving no margin for unexpected expenses or downturns. The drastic reduction in net assets from £8,388 to £1 over one year is a concerning symptom that indicates erosion of financial stability—possibly due to operating losses or increased liabilities.

The company's liquidity is effectively "on life support," with current assets barely covering short-term debts. This fragile state suggests the business is at risk of cash flow distress, which could impair its ability to fund daily operations or invest in growth opportunities.

Despite these challenges, the company complies with filing obligations and maintains operational status with a single director and one employee, indicating management is attentive to governance but may need to address underlying financial health urgently.

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4. Recommendations

• Improve Working Capital Management: Actively manage receivables, payables, and inventory to increase net current assets. Consider negotiating longer payment terms with suppliers or accelerating collections.

• Strengthen Equity Base: Explore options to increase share capital or retain earnings through profitability improvements. Additional funding injections from shareholders or external investors could provide a financial cushion.

• Cost Control Measures: Review operating expenses to identify savings opportunities. As a micro-entity with limited staff, optimizing overheads is critical for survival.

• Cash Flow Forecasting: Implement robust cash flow monitoring to anticipate liquidity shortages and plan accordingly.

• Explore Revenue Growth: Given the small scale, consider diversifying clients or services within the utility construction sector to increase turnover and profitability.

• Seek Professional Advice: Early consultation with financial advisors or insolvency practitioners can help navigate options such as restructuring before distress worsens.

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