HOUSEMARTIN PROJECTS LTD

Executive Summary

HOUSEMARTIN PROJECTS LTD maintains a stable asset base and positive equity but faces ongoing liquidity challenges caused by negative working capital. While solvent and growing in net worth, the company should prioritize improving cash flow and managing short-term liabilities to ensure ongoing financial health and operational stability.

HOUSEMARTIN PROJECTS LTD - Analysis Report

Company Number: 13395876

Analysis Date: 2025-07-29 20:02 UTC

Financial Health Assessment for HOUSEMARTIN PROJECTS LTD (as of 31 August 2024)

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1. Financial Health Score: C (Fair)

Explanation:
The company shows stable asset holdings and a positive equity base, but there are persistent symptoms of liquidity stress due to current liabilities exceeding current assets significantly. The balance sheet structure is somewhat imbalanced, indicating moderate financial strain that needs careful management to avoid deterioration.

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2. Key Vital Signs (Core Financial Metrics & Interpretation):

Metric	2024 Value	Interpretation
Fixed Assets	£288,684	Stable asset base, likely property holdings typical for real estate sector
Current Assets	£8,116	Very low liquid assets, potential cash flow tightness
Current Liabilities	£101,370	Significant short-term obligations; risk of liquidity crunch
Net Current Assets	(£92,917)	Negative working capital; "symptom of distress" in short-term finances
Creditors > 1 Year	£115,034	Long-term debt burden remains high but slightly reduced from prior year
Net Assets / Shareholders' Funds	£80,733	Positive equity buffer, growing steadily over 4 years
Share Capital	£2	Minimal share capital, typical for micro-entities
Average Employees	0	No staff employed, likely owner-managed with minimal overhead

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3. Symptoms Analysis (What the Numbers Reveal):

• Asset Stability but Cash Flow Concerns: The fixed assets remain constant at £288,684, indicating no recent acquisitions or disposals—likely property or long-term investments. However, the very low current assets compared to high current liabilities suggest the company may struggle with meeting short-term obligations promptly, a classic "cash flow crunch".

• Negative Working Capital: The net current assets are deeply negative (£-92,917), which is a strong symptom of illiquidity. This means the company owes more in the short term than it has available to cover these debts, a potential red flag for operational sustainability if not managed.

• Moderate Leverage: Long-term creditors have decreased slightly from £134,501 to £115,034, showing some repayment or refinancing activity. While leverage remains significant compared to equity, it is not deteriorating, indicating controlled debt management.

• Equity Growth: Shareholders’ funds have improved from £69,442 in 2021 to £80,733 in 2024, showing retained earnings or asset revaluation gains. This "healthy pulse" in equity suggests the owners have maintained the company’s net worth despite liquidity challenges.

• No Employees: The company operates without staff, suggesting low operational costs, possibly managing properties or leases without active trading or heavy administration.

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4. Diagnosis (Overall Financial Condition):

HOUSEMARTIN PROJECTS LTD presents as a micro-entity with a stable long-term asset base typical of property management or real estate leasing. However, it exhibits symptoms of short-term financial strain, highlighted by consistently negative working capital and a tight liquidity position. The company’s equity is positive and growing, indicating that on a net asset basis, it is solvent and maintaining value.

The financial "vital signs" suggest the company is currently stable but vulnerable to cash flow disruptions. Without improvement in liquid assets or reduction in current liabilities, the risk of distress increases, potentially impacting operational flexibility or creditor relationships.

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5. Prognosis (Future Financial Outlook):

• Short-Term: The company must address liquidity issues to avoid cash flow crises. Without intervention, the negative net current assets could lead to payment delays or pressure from creditors.

• Medium to Long-Term: If the company can maintain or improve equity levels and manage debt prudently, it should remain solvent. The stable fixed asset base provides collateral strength.

• Risks: Continued negative working capital and reliance on long-term creditors pose risks, especially if market conditions in real estate soften or if creditors demand accelerated repayments.

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6. Recommendations (Specific Actions to Improve Financial Wellness):

1. Improve Liquidity Management:

   • Increase cash reserves or current assets through better receivables management or short-term financing arrangements.
   • Negotiate longer payment terms with creditors to reduce current liabilities pressure.

2. Review Debt Structure:

   • Explore refinancing options to convert some short-term debts into longer-term obligations, smoothing out cash flow demands.

3. Enhance Cash Flow Forecasting:

   • Implement detailed monthly cash flow forecasts to anticipate and manage liquidity gaps proactively.

4. Cost Control and Revenue Optimization:

   • Although no employees are currently hired, evaluate operational expenses and seek additional income streams related to property assets to bolster cash inflows.

5. Engage with Financial Advisors:

   • Consider professional advice on capital restructuring or grants/tax reliefs available for small property-related businesses.

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