LCW PROPERTY SERVICES LIMITED

Executive Summary

LCW PROPERTY SERVICES LIMITED shows a strong asset base but is currently experiencing liquidity and solvency challenges, as evidenced by negative working capital and net liabilities. Without intervention to improve cash flow and restructure debt, the company risks continued financial distress. Immediate actions to stabilize liquidity and strengthen equity are recommended to restore financial health.

LCW PROPERTY SERVICES LIMITED - Analysis Report

Company Number: 14250907

Analysis Date: 2025-07-29 20:20 UTC

Financial Health Assessment for LCW PROPERTY SERVICES LIMITED
(as at 31 July 2024)

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1. Financial Health Score: D

Explanation:
The company shows persistent net liabilities and negative working capital, indicating financial distress symptoms. While it holds significant fixed assets (investment property), the high level of long-term and current liabilities outweighs assets, putting pressure on liquidity and solvency. The absence of an operating profit figure limits full diagnosis, but ongoing negative equity is a concerning sign.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Fixed Assets	724,602	Healthy asset base, primarily investment property.
Cash	6,053	Very low cash reserves; limited liquidity buffer.
Current Liabilities	272,261	High short-term obligations; risk of liquidity strain.
Net Current Assets	-266,208	Negative working capital; symptoms of cash flow distress.
Creditors > 1 year (Debt)	466,588	Significant long-term debt burden.
Net Assets (Equity)	-8,194	Negative shareholders’ funds, indicating insolvency risk.
Profit & Loss Account	-8,294	Accumulated losses; no retained profits.
Employees (average)	1	Very small operational scale.

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3. Diagnosis

LCW PROPERTY SERVICES LIMITED presents a financial profile akin to a patient with a chronic condition: a solid asset "skeleton" (investment property valued at £719,706) but weak "circulatory system" (cash and current assets) unable to sustain operational demands. The company is burdened by significant debt both short and long term, with working capital in persistent deficit, signaling liquidity distress.

Negative net assets and shareholders’ funds reflect accumulated losses or possibly initial funding deficits, indicating the company’s "body" (equity) is under stress. The limited cash reserves ("fluid") restrict ability to meet immediate obligations without refinancing or asset sales.

The stable fixed asset value with minimal depreciation suggests no impairment yet, but the financial strain visible in liabilities and negative equity are symptoms of financial imbalance. Without profit and loss details, it's unclear whether the company is generating operating cash flow or relying on loans from directors, but the level of director loans within current liabilities indicates dependency on internal funding.

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4. Recommendations

• Improve Liquidity: Increase cash reserves to alleviate the symptoms of liquidity strain. This can be done by accelerating receivables, delaying non-essential payables, or injecting fresh capital.
• Debt Restructuring: Engage with lenders to potentially renegotiate terms on both short and long-term debts to ease repayment pressure and improve working capital.
• Profitability Enhancement: Review operational efficiency and revenue streams to start generating positive operating cash flow, which will help heal the negative equity.
• Asset Utilization: Consider leveraging or selectively selling non-core assets if immediate cash is required, but maintain the core investment property to preserve asset base.
• Regular Financial Monitoring: Establish frequent financial check-ups (monthly cash flow and working capital reviews) to monitor for early symptoms of distress and intervene timely.
• Director Support: Evaluate and formalize director loans and consider converting some debt to equity if possible to strengthen shareholders' funds.

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