HYGIENIC CLADDING PROJECTS LIMITED

Executive Summary

Hygienic Cladding Projects Limited shows a solid financial position with healthy liquidity and growing net assets, reflecting good management of working capital and investment in fixed assets. The company is financially stable, with manageable debt levels and no signs of distress, earning a financial health grade of B. Maintaining prudent financial controls and monitoring leverage will support continued business wellness and growth.

HYGIENIC CLADDING PROJECTS LIMITED - Analysis Report

Company Number: 13485105

Analysis Date: 2025-07-19 12:33 UTC

Financial Health Assessment for Hygienic Cladding Projects Limited
As of Financial Year Ended 30 June 2024

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1. Financial Health Score: B

Explanation:
Hygienic Cladding Projects Limited demonstrates solid financial footing for a micro-entity with healthy growth in net assets and working capital over recent years. The company shows a strong ability to cover short-term liabilities with current assets, indicating good liquidity ("healthy cash flow"). The increase in fixed assets suggests ongoing investment in operational capacity. However, the presence of some medium- to long-term liabilities and limited equity base relative to growth opportunities tempers the score to a "B" rather than an "A."

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2. Key Vital Signs (Core Financial Metrics)

Metric	2024 Value (£)	Interpretation
Fixed Assets	64,774	Nearly doubled from prior year, indicating reinvestment in the business. Healthy sign of fixed capital growth.
Current Assets	276,782	Strong short-term asset base, increased significantly from prior years, giving liquidity cushion.
Current Liabilities	139,477	Increased but well covered by current assets; ratio approx. 2:1, signalling good short-term solvency.
Net Current Assets (Working Capital)	137,305	Positive and growing; the company can comfortably meet short-term obligations, reflecting "healthy cash flow."
Net Assets (Equity)	170,992	Steadily increasing net assets reflect retained earnings and capital strength.
Share Capital	2.00	Minimal nominal capital, typical for micro-entities.

Liquidity Ratio (Current Ratio) = Current Assets / Current Liabilities = 276,782 / 139,477 ≈ 1.98

• A ratio near 2 is considered good liquidity, showing the company can cover nearly twice its short-term debts.

Leverage: The company has £31,087 of creditors due after more than one year as of 2024, indicating some medium-term borrowing. This is manageable given the equity base but requires monitoring.

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3. Diagnosis (What the Numbers Reveal)

The company exhibits the "vital signs" of a financially stable micro-business:

• Healthy Cash Flow & Liquidity: Strong net current assets and current ratio indicate the company can meet its short-term obligations comfortably without stress.
• Growth in Asset Base: Fixed assets have doubled in the latest year, suggesting investment in operational capacity or equipment, which is a positive sign of business expansion or upgrading.
• Increasing Equity: Net assets have increased by over 60% year-on-year, indicating profitability or capital injections retained in the business.
• Controlled Leverage: Introduction of some long-term liabilities in 2024 is a sign of measured borrowing, likely to fund asset acquisition. This is not excessive for the size of the business but should be managed prudently.
• Stable Employment: The average headcount remains 2, consistent with micro-entity classification, implying operational stability without rapid scaling pressures.

No symptoms of financial distress (e.g., negative working capital, consistent losses, excessive debt) are present. The business appears "fit" with healthy liquidity, asset growth, and equity strengthening.

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4. Recommendations (Prescriptions for Financial Wellness)

To maintain and improve financial health, the company should consider:

1. Monitor Debt Levels: Keep medium- and long-term liabilities under control to avoid over-leverage. Ensure that borrowings are aligned with growth and cash flow projections.
2. Maintain Cash Flow Discipline: Continue close management of working capital, focusing on debtor collection and inventory control to preserve liquidity.
3. Capital Structure Review: Given minimal share capital, evaluate if additional equity funding might support expansion plans or provide a buffer against unforeseen risks.
4. Profitability Tracking: Although profit and loss details are not filed, ensure profitability is sustained or improved through detailed internal monitoring to support net asset growth.
5. Strategic Investment: With increased fixed assets, regularly assess return on these investments to ensure they contribute positively to the bottom line.
6. Compliance and Reporting: Maintain timely filings and accurate records to avoid penalties and support transparent governance.

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