JGR HQ LIMITED

Executive Summary

JGR HQ LIMITED is currently facing financial challenges characterized by negative equity and liquidity shortfalls, though some asset growth provides a glimmer of hope. Immediate focus on cash flow improvement and capital strengthening is essential to avoid further deterioration and support sustainable operations in the competitive fitness facilities sector.

JGR HQ LIMITED - Analysis Report

Company Number: 14254212

Analysis Date: 2025-07-20 18:35 UTC

Financial Health Assessment of JGR HQ LIMITED (as of 31 July 2024)

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1. Financial Health Score: D

Explanation:
JGR HQ LIMITED's financial position shows clear signs of distress. The company has a negative shareholder equity (shareholders funds) for consecutive years, meaning liabilities exceed assets. While there is some increase in assets and a reduction in the negative equity from the prior year, the working capital position remains weak, indicating liquidity challenges. Given these symptoms, the company’s financial health is below average and requires attention.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Fixed Assets	17,361	Increased investment in long-term assets; positive sign for operational capacity.
Current Assets	12,818	Increased from previous year, but still insufficient to cover short-term debts.
Current Liabilities	36,063	Substantially higher than current assets, indicating short-term liquidity strain.
Net Current Assets (Working Capital)	(23,245)	Negative working capital, a symptom of financial stress—company may struggle to meet short-term obligations.
Shareholders’ Funds (Equity)	(4,875)	Negative equity implies accumulated losses exceeding invested capital—a sign of financial distress.
Average Number of Employees	2	Small workforce consistent with micro-entity status; operational scale is limited.

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3. Diagnosis

JGR HQ LIMITED is exhibiting symptoms akin to a patient with chronic financial stress:

• Liquidity Issues: The company’s current liabilities nearly triple its current assets, indicating insufficient liquid resources to cover immediate debts ("symptom of distress").
• Negative Equity: Shareholders’ funds are negative, which is a critical "vital sign" showing that the company’s accumulated losses outweigh its capital base. This situation threatens long-term solvency.
• Asset Growth: Fixed assets nearly doubled, suggesting investment in business infrastructure or equipment, which may improve operational capacity if matched by sustainable cash flows.
• Improvement Signs: Compared to the previous year, shareholder funds improved (less negative), and both fixed and current assets increased. This indicates some recovery or growth efforts, though still fragile.
• Micro-Entity Profile: With only two employees and micro-entity status, the company is small, which limits access to capital markets and may constrain growth or turnaround options.

In medical terms, the company is in a "critical but stable" condition. Without intervention, liquidity constraints and negative equity may worsen, possibly leading to insolvency.

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4. Recommendations

To improve financial wellness and avoid worsening symptoms, JGR HQ LIMITED should consider the following actions:

• Enhance Cash Flow Management:
  Prioritize collections from customers and manage payables to improve net current assets. Consider short-term financing options to cover liquidity gaps.

• Cost Control and Efficiency:
  Review operational expenses to reduce burn rate, given the small workforce. Efficient cost management can help preserve cash reserves.

• Capital Injection:
  Seek additional equity funding or shareholder loans to restore positive net assets and strengthen the balance sheet.

• Review Asset Utilization:
  Ensure fixed assets investments are generating returns; underutilized assets tie up capital unnecessarily.

• Financial Monitoring:
  Implement regular financial reviews tracking liquidity ratios and equity position to detect early warning signs.

• Explore Growth Opportunities Cautiously:
  Given current financial constraints, growth initiatives should be carefully assessed for cash flow impact.

• Professional Advice:
  Engage a business advisor or financial consultant to assist with turnaround strategies and improve financial planning.

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