IVY COSMETIC CLINIC LIMITED

Executive Summary

IVY Cosmetic Clinic Limited is currently in a fragile financial state with negative net assets and worsening working capital deficits, signaling liquidity and solvency challenges. Immediate focus on cash flow management, liability restructuring, and cost control is critical to stabilize and improve financial health. With proactive management and strategic adjustments, the company can avoid deeper financial distress and work toward recovery.

IVY COSMETIC CLINIC LIMITED - Analysis Report

Company Number: 13005900

Analysis Date: 2025-07-29 13:03 UTC

Financial Health Assessment: IVY COSMETIC CLINIC LIMITED

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1. Financial Health Score: D

Explanation:
The company exhibits clear symptoms of financial distress, notably persistent negative net assets and worsening working capital deficits. While still operational and compliant with filing requirements, the financial "vital signs" indicate a fragile state requiring immediate attention.

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2. Key Vital Signs

Metric	2024 (£)	Analysis
Fixed Assets	41,161	Stable, reflecting investment in long-term assets; no major write-offs noted.
Current Assets	11,514	Declined significantly from prior year (19,225), indicating reduced liquid resources.
Current Liabilities	42,777	Increased from previous year (34,219 in 2023), indicating growing short-term obligations.
Net Current Assets (Working Capital)	-26,439	Negative and deteriorated sharply, signaling liquidity strain and potential cash flow problems.
Total Assets Less Current Liabilities	14,722	Decreased, highlighting erosion of asset buffer after settling current debts.
Creditors Due After One Year	32,697	Substantial long-term liabilities, slightly reduced but still high relative to assets.
Net Assets (Shareholders Funds)	-20,135	Negative and worsened considerably from -5,837 last year, showing accumulated losses.
Employees	0	No employees, likely minimal payroll burden, but may imply limited operational capacity.

Interpretation:

• Negative Net Assets: The company’s liabilities exceed its assets by £20,135, a critical symptom akin to "organ failure" in financial terms, indicating insolvency on a balance sheet basis.
• Worsening Working Capital: The working capital deficit has more than tripled in a year, a "weak pulse" that hints at liquidity problems and inability to meet short-term obligations comfortably.
• Stable Fixed Assets: The fixed asset base remains consistent, showing no distress sales or impairment, which is a positive sign.
• No Employees: Could reflect lean operations or outsourcing but may limit growth or resilience.

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3. Diagnosis

IVY Cosmetic Clinic Limited is showing symptoms of financial distress characterized by declining liquidity and increasing liabilities outweighing assets. The negative net assets and worsening working capital indicate the business is "unwell" and potentially at risk of insolvency if the trend continues.

The absence of employees may suggest very lean operations, possibly owner-run or relying on contractors, which reduces overheads but may limit scalability. The company remains active and up to date with filings, suggesting management is maintaining statutory compliance despite financial challenges.

The financial data indicates the company is currently in a vulnerable state—akin to a patient with chronic illness that requires intervention to avoid further deterioration or collapse.

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4. Recommendations

To improve the financial wellness of IVY Cosmetic Clinic Limited, the following steps are advised:

1. Improve Cash Flow Management:

   • Review and accelerate debtor collections to boost current assets.
   • Negotiate extended payment terms with creditors to ease short-term cash pressure.
   • Consider short-term financing options (overdraft, invoice financing) cautiously to bridge liquidity gaps.

2. Restructure Liabilities:

   • Engage with lenders or creditors to restructure or refinance long-term debt to reduce immediate burden.
   • Explore equity injections from shareholders or new investors to restore positive net assets.

3. Cost Control and Operational Review:

   • Conduct an operational audit to identify and cut non-essential expenses.
   • Evaluate revenue streams and pricing strategies to enhance profitability.

4. Strategic Planning and Growth:

   • Develop a clear business plan addressing market positioning and growth opportunities in the cosmetic clinic sector.
   • Leverage the directors’ pharmaceutical expertise to differentiate services or expand offerings.

5. Professional Advice:

   • Seek advisory support from financial consultants or insolvency practitioners early to avoid crisis.

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