H&Y PROPERTY MANAGEMENT LTD

Executive Summary

H&Y PROPERTY MANAGEMENT LTD is experiencing serious financial distress characterized by negative net assets and worsening liquidity, primarily funded through director loans. Without intervention, the company risks insolvency. Immediate steps to improve cash reserves, restructure debts, and develop sustainable operations are critical to restoring financial health.

H&Y PROPERTY MANAGEMENT LTD - Analysis Report

Company Number: 13827494

Analysis Date: 2025-07-29 17:51 UTC

Financial Health Assessment Report for H&Y PROPERTY MANAGEMENT LTD

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1. Financial Health Score: D

Explanation:
The company shows significant financial distress signs, particularly a persistent negative net asset position and worsening working capital. While it remains active and compliant with filing requirements, its balance sheet reveals "symptoms of severe strain," akin to a patient with a chronic condition that needs urgent care to avoid further deterioration.

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2. Key Vital Signs (Core Financial Metrics) and Interpretation

Metric	2024 Value (£)	2023 Value (£)	Interpretation
Cash at hand	793	1,089	Critically low liquid cash reserves — "weak pulse" in liquidity, insufficient to cover short-term needs.
Current Liabilities	118,657	72,066	Rising short-term debts, predominantly director loans, indicating increasing reliance on insiders.
Net Current Assets	-117,864	-70,977	Working capital is deeply negative — "symptom of distress" in day-to-day operations' liquidity.
Net Assets	-62,864	-15,977	Overall net worth is negative and deteriorating — "organ failure" in financial health.
Shareholders' Funds	-62,866	-15,979	Equity deficit shows accumulated losses exceeding invested capital — "chronic illness" in financial structure.

Additional Notes:

• Fixed assets (investment property) valued at £55,000 remain stable but are insufficient to offset liabilities.
• Loans from directors have increased sharply, indicating dependence on related-party financing to keep operations afloat.
• No employees; no audit required given small company status.

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3. Diagnosis: What the Financial Data Reveals About Business Health

H&Y PROPERTY MANAGEMENT LTD is in a precarious financial condition resembling a patient with a chronic illness that is worsening without effective intervention:

• Liquidity Crisis: The company has minimal cash and substantial current liabilities, indicating an inability to meet short-term obligations without external support.
• Capital Erosion: Negative net assets imply that the business's liabilities exceed its total assets, reducing creditor confidence and limiting borrowing capacity.
• Funding Dependence: Increasing director loans suggest reliance on insiders as a temporary "life support" measure rather than sustainable financing.
• Operational Scale: The absence of employees and minimal reported operational activities may reflect a startup phase or dormant operations but also implies limited revenue generation.
• Compliance: Despite financial challenges, the company is up to date with filings, indicating responsible governance in regulatory terms.

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4. Recommendations: Specific Actions to Improve Financial Wellness

1. Liquidity Management:

   • Urgently increase liquid cash reserves to cover at least 3 months of short-term liabilities. Consider injecting equity or arranging external short-term credit facilities.
   • Improve cash flow forecasting to anticipate and manage liquidity bottlenecks.

2. Debt Restructuring:

   • Negotiate repayment terms with directors to formalize and possibly extend loans, avoiding forced repayments that could exacerbate cash shortages.
   • Explore refinancing options or equity injections to reduce reliance on director loans.

3. Asset Utilization and Growth Strategy:

   • Evaluate the investment property for potential value enhancement or sale to improve cash position.
   • Develop a clear operational plan to generate sustainable revenues, including exploring new lettings or property management contracts.

4. Cost Control:

   • Maintain minimal overheads while scaling up operations. Without employees, keep administrative costs low but ensure compliance and governance standards are met.

5. Financial Monitoring:

   • Implement monthly financial reviews focusing on liquidity ratios and working capital to detect early signs of distress.
   • Engage financial advisory services for turnaround strategy and possible restructuring.

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