JMK PROPERTY MANAGEMENT LIMITED

Executive Summary

JMK PROPERTY MANAGEMENT LIMITED exhibits signs of financial distress, characterized by negative equity and poor liquidity despite significant fixed assets. Immediate actions to improve cash flow, restructure debt, and possibly inject capital are essential to restore financial health and ensure ongoing viability.

JMK PROPERTY MANAGEMENT LIMITED - Analysis Report

Company Number: 14130923

Analysis Date: 2025-07-29 12:26 UTC

Financial Health Assessment for JMK PROPERTY MANAGEMENT LIMITED

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1. Financial Health Score: D (Distressed but not critical)

Explanation:
JMK PROPERTY MANAGEMENT LIMITED shows signs of financial distress primarily due to its negative net asset position despite holding significant fixed assets. The persistent negative net assets (shareholders’ funds) indicate that liabilities exceed assets, which is a warning sign for solvency. However, the company remains operational and not in liquidation, so urgent corrective actions could improve its financial health.

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2. Key Vital Signs

Vital Sign	2024 Value	Interpretation
Fixed Assets	£268,000	Stable, representing long-term property holdings or investments.
Current Assets	£9,305	Very low liquidity; cash or short-term assets insufficient.
Current Liabilities	£83,867	Significant short-term debts that must be settled within the year.
Net Current Assets	-£74,562	Negative working capital, indicating a liquidity crunch.
Creditors > 1 year	£200,980	Large long-term liabilities, possibly loans or mortgages.
Net Assets (Equity)	-£7,542	Negative equity; shareholders’ funds are in deficit.
Employees	0	No staff costs; possibly a holding or asset management company.

Interpretation:

• The negative net current assets (working capital) highlight a "symptom of distress" — the company does not have enough liquid resources to cover short-term obligations, risking liquidity problems.
• The large long-term liabilities compared to assets suggest the company is highly leveraged.
• The fixed assets value is healthy, which may be underlying property assets, but these are illiquid and can't quickly solve cash flow issues.
• Negative shareholders’ funds imply accumulated losses or a capital deficit, indicating solvency concerns.

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3. Diagnosis

JMK PROPERTY MANAGEMENT LIMITED operates in the real estate sector, managing or owning property assets. The "healthy cash flow" expected in such businesses is currently not evident due to the company's insufficient current assets relative to current liabilities. The company carries significant debt, both short and long term, which has led to a negative equity position.

Symptoms of distress include:

• Negative working capital (current liabilities exceed current assets by approximately £74.5k).
• Negative net assets, indicating liabilities exceed total assets by £7,542.
• No employees, suggesting a minimal operating structure which may reduce overhead but also limits operational flexibility.
• No audit requirement (micro-entity exemption) means less external scrutiny, but also less assurance about financial robustness.

Overall, the financial data reveals a company under pressure from its debt load, with limited liquidity to meet short-term obligations, and a net deficit in equity. This reflects a borderline solvency issue that could deteriorate if not addressed.

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4. Recommendations

To improve financial wellness, the company should consider the following steps:

• Improve Liquidity:
  Explore ways to increase current assets, particularly cash, by accelerating receivables, reducing inventory (if any), or injecting working capital from shareholders. This will help manage short-term debts and avoid liquidity crises.

• Debt Restructuring:
  Engage with creditors to renegotiate terms on both current and long-term liabilities. Extending repayment periods or reducing interest costs could ease cash flow pressure.

• Capital Injection:
  Consider raising equity capital to restore positive net assets and improve solvency metrics. This could involve new investors or shareholder loans formally converted to equity.

• Asset Optimization:
  Evaluate the fixed assets for possible sale or refinancing. Unlocking equity tied in property could provide funds to reduce liabilities and improve working capital.

• Cost Management:
  Maintain lean operations with zero employees to minimize overhead. However, ensure operational capabilities are sufficient for business continuity.

• Financial Monitoring:
  Implement rigorous cash flow forecasting and financial controls to detect and manage risks early.

• Professional Advice:
  Seek specialist advice on restructuring and insolvency options to avoid forced liquidation if conditions worsen.

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