JB LEARNING LTD

Executive Summary

JB LEARNING LTD is currently showing signs of financial distress with negative net assets and deteriorating liquidity, indicating potential insolvency risks. Immediate action to improve cash flow, manage costs, and consider capital injection is essential to stabilize the business. Without intervention, the company's financial health is likely to worsen.

JB LEARNING LTD - Analysis Report

Company Number: 14522147

Analysis Date: 2025-07-29 19:16 UTC

Financial Health Assessment: JB LEARNING LTD
Financial Year End: 31 December 2024

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1. Financial Health Score: D

Explanation:
The company exhibits significant signs of financial distress with net current liabilities and negative net assets in the latest year. While the previous years showed a small positive net asset position (£301), the current year reflects a sharp deterioration to negative £3,051. This indicates that the company’s liabilities exceed its current assets by a considerable margin, which is a critical warning sign.

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2. Key Vital Signs

Metric	2024 Value	2023 Value	Interpretation
Current Assets	£38	£1,008	Drastic reduction in liquid resources
Current Liabilities	£3,089	£1,309	Sharp increase in short-term obligations
Net Current Assets (Working Capital)	-£3,051	£301	Shift from positive to negative working capital ("cash flow congestion")
Total Net Assets (Equity)	-£3,051	£301	Negative equity indicates insolvency symptoms
Average Number of Employees	1	1	Small scale operation, minimal operational complexity

Interpretation:

• Current Assets vs Liabilities: The company’s current liabilities now outstrip current assets by a wide margin, suggesting potential liquidity problems.
• Net Assets: Negative net assets imply the company owes more than it owns, a classic symptom of financial distress.
• Trend: The sharp decline from positive to negative net assets within a year signals worsening financial health.

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3. Diagnosis

Underlying Business Health:
JB LEARNING LTD appears to be in the early stages of financial strain. The “vital signs” indicate a weakening liquidity position and growing short-term obligations without sufficient assets to cover them. The company’s cash flow is likely under pressure, risking difficulties in meeting immediate financial commitments.

The micro-entity status and single employee suggest a very small operation, possibly a sole proprietorship-type business within a corporate shell, focused on educational support services. The director, who is also the sole shareholder with full control, may be personally involved in operations.

The drop in current assets from £1,008 to £38 could indicate depletion of cash reserves or receivables, while the rise in current liabilities from £1,309 to £3,089 suggests increased debts or unpaid bills. Negative net assets at this stage are dangerous because they often precede insolvency or require immediate corrective measures.

Symptoms of distress:

• Negative working capital ("cash flow congestion")
• Eroding equity base (negative net assets)
• Increased short-term liabilities without matching asset growth

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4. Recommendations

To restore financial wellness and avoid progression into insolvency, the company should consider the following steps:

A. Improve Liquidity:

• Accelerate collection of any outstanding receivables (if applicable).
• Negotiate extended payment terms with suppliers to reduce immediate cash outflows.
• Avoid incurring further short-term liabilities without corresponding cash inflows.

B. Capital Injection:

• The sole shareholder should consider injecting fresh capital to restore positive net assets and improve working capital. This can be in the form of equity or a director’s loan.

C. Cost Management:

• Review operating expenses to identify and reduce unnecessary costs.
• Given the very small size (1 employee), ensure that the business model is sustainable and scalable.

D. Financial Monitoring:

• Implement regular cash flow forecasts to anticipate liquidity issues early.
• Consider professional advice on restructuring if liabilities continue to grow or if the business model is under stress.

E. Compliance and Reporting:

• Maintain timely filing of accounts and confirmation statements to avoid penalties and maintain credibility.

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Medical Analogy Summary

The company’s financial "pulse" shows a critical drop in liquidity — akin to a patient whose blood pressure has fallen dangerously low. The “symptoms” (negative net assets and working capital deficit) signal that without immediate intervention (capital injection and cost control), the business risks “organ failure” (insolvency). Prompt action is necessary to stabilise and restore financial health.

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