J&S FENCING AND MAINTENANCE LIMITED

Executive Summary

J&S Fencing and Maintenance Limited's financial health shows early signs of liquidity stress with negative working capital, though equity has improved. The company’s small asset base and lack of employees suggest limited operational scale. Strengthening cash flow and capital structure are key to improving its financial outlook.

J&S FENCING AND MAINTENANCE LIMITED - Analysis Report

Company Number: 12934339

Analysis Date: 2025-07-20 12:02 UTC

Financial Health Assessment of J&S FENCING AND MAINTENANCE LIMITED

---

1. Financial Health Score: C

Explanation:
The company shows signs of moderate financial distress. While the shareholders’ funds have improved since last year, the current assets are insufficient to cover current liabilities, indicating potential liquidity issues. The modest asset base and absence of employees further suggest a very small-scale operation with limited scale and capacity for growth without additional capital or restructuring.

---

2. Key Vital Signs

Metric	2023 Value (£)	Interpretation
Fixed Assets	4,435	Stable but low; reflects limited long-term investment in property/equipment.
Current Assets	1,513	Declined sharply from previous year; cash or receivables are limited.
Current Liabilities	2,127	Reduced but still exceeds current assets, a sign of working capital strain.
Net Current Assets	(614)	Negative working capital ("symptom of distress" in liquidity); company may struggle to meet short-term debts.
Shareholders’ Funds	3,242	Increased from £1,938 in 2022, indicating some retained earnings or capital injection improving net worth.
Average Employees	0	No staff employed during the year, indicating minimal operational scale or possibly outsourcing.

Vital Signs Interpretation:

• The negative net current assets is a crucial red flag indicating the company does not have enough short-term assets to cover its short-term liabilities. This is like a patient whose immediate energy reserves are insufficient to meet urgent needs.
• The increase in shareholders’ funds is a positive sign of improving equity or profitability, which could be seen as the body building reserves to fight off illness.
• The small fixed asset base and no employees imply a very lean operation, possibly reliant on subcontractors or temporary resources, limiting operational capacity.

---

3. Diagnosis: Overall Financial Condition

J&S Fencing and Maintenance Limited is a micro-entity operating within the landscape and construction installation sector. The company is showing early signs of liquidity stress due to negative working capital, which is a critical symptom that must be addressed to avoid worsening financial health. The company’s capital structure remains weak but shows signs of improvement with an increase in shareholders’ funds. The lack of employees suggests minimal business activity or a non-traditional operating model which may affect growth and sustainability.

Despite the reduction in current liabilities and accrued expenses compared to the previous year, the sharp decline in current assets is concerning. The company's financial "immune system" is weak, with limited liquid resources to respond to financial demands. This puts the company at risk if unexpected expenses arise or if revenue streams are disrupted.

---

4. Recommendations

To improve financial wellness and address current symptoms, the company should consider the following actions:

• Improve Liquidity:

  • Accelerate collection of receivables or convert short-term assets into cash to strengthen working capital.
  • Negotiate longer payment terms with suppliers to reduce immediate cash outflows.

• Increase Capital Base:

  • Consider a capital injection from shareholders or external investors to bolster equity and support growth.
  • Explore grants or small business loans suited for micro-businesses to build a cash buffer.

• Operational Review:

  • Assess the business model to determine if outsourcing or subcontracting is sustainable or if hiring employees could improve operational efficiency and revenue.
  • Implement tighter cost controls and budgeting to preserve cash.

• Financial Monitoring:

  • Establish regular financial health checks (monthly cash flow forecasts, balance sheet reviews) akin to regular "health monitoring" to catch early warning signs.
  • Engage with an accountant or financial advisor to optimize tax and financial structure.

• Strategic Growth Planning:

  • Explore opportunities to increase turnover within the micro-entity limits while maintaining financial discipline.
  • Diversify service offerings or client base to reduce risk and improve revenue consistency.

---

Executive Summary

J&S Fencing and Maintenance Limited is currently facing liquidity challenges evidenced by negative working capital, despite an improvement in shareholders’ funds. The company operates on a very small scale with minimal assets and no employees, indicating limited operational capacity. Immediate actions to improve cash flow and strengthen the equity base are critical to stabilise financial health and support future growth.