LIGABUE UK LIMITED

Executive Summary

Ligabue UK Limited exhibits a strong financial position marked by increasing net assets and robust working capital, reflecting sound liquidity and solvency. While growth is evident, attention to debtor management and cash reserves is essential to maintain healthy cash flow. Overall, the company’s financial outlook is favourable, with a solid foundation for future expansion.

LIGABUE UK LIMITED - Analysis Report

Company Number: 12707988

Analysis Date: 2025-07-29 19:36 UTC

Financial Health Assessment: Ligabue UK Limited
Assessment Date: Financial Year Ended 31 December 2022

---

1. Financial Health Score: B+

Explanation:
Ligabue UK Limited demonstrates strong improvement in key financial metrics over recent years, showing a robust balance sheet and a marked increase in net current assets and net assets. While the company is relatively young (incorporated 2020) and still small in scale, the financials indicate a healthy liquidity position and growing equity base. However, some caution is warranted due to the company's small scale and industry risks inherent in event catering and freight transport sectors.

---

2. Key Vital Signs

Metric	2022 Value	Interpretation
Current Assets	£1,380,318	Healthy pool of short-term assets; increased by ~57% from 2021, reflecting growth or better asset management.
Cash at Bank	£194,613	Adequate cash reserves, though less than in 2021 (£322,910), which could indicate cash tied up elsewhere or used for investments.
Debtors (Receivables)	£1,185,705	Substantial increase from prior year (£423,780), indicating higher sales or longer credit terms. Requires monitoring for collectability.
Current Liabilities	£450,427	Significantly reduced from 2021 (£694,235), suggesting improved short-term debt management and lower immediate obligations.
Net Current Assets (Working Capital)	£929,891	Strong positive working capital, a key sign of liquidity and operational health. Substantial improvement from £183,183 in 2021.
Net Assets (Equity)	£929,891	Large increase from £183,183 in 2021, showing retained earnings growth and strengthening financial foundation.
Share Capital	£1,000	Nominal share capital; company relies primarily on retained profits for equity growth.
Average Number of Employees	1 (2022)	Small workforce, consistent with a small company account category.

Additional Context:

• The company is classified as a Small Private Limited Company and files under the small companies regime, with exemption from audit.
• Industry SIC codes indicate activity in event catering (56210) and sea/coastal freight water transport (50200) — sectors that can be cyclical and sensitive to economic factors.
• The company has no overdue filings and is in good standing.

---

3. Diagnosis: Underlying Business Health

• Liquidity ("Healthy Cash Flow"): The company’s working capital position is robust with net current assets of £929,891, indicating it has sufficient short-term resources to cover its immediate liabilities. This is a critical "vital sign" showing the company is not under liquidity distress.

• Asset Quality and Receivables ("Symptom of Extended Credit"): The significant rise in trade debtors from £276k (2021) to £617k (2022) and total debtors to £1.19M suggests either increased sales or longer credit terms to customers. While growth in receivables can be positive, it also carries a risk of cash flow strain if these debts are not collected timely. Monitoring debtor ageing and collection efficiency is recommended.

• Leverage and Solvency ("Strong Equity Base"): Net assets have increased substantially, indicating retained profits and good solvency. The company is not heavily reliant on external debt, which is a positive sign of financial stability.

• Operational Scale ("Micro to Small Scale"): With only one employee and modest share capital, the company is small but growing. The increase in current assets and equity suggests expanding operations, possibly scaling up in catering and freight services.

• Profitability (Limited Data): The accounts do not disclose the Profit & Loss account in detail, but the rise in retained earnings implies profitability or positive retained results over the years.

• Risk Factors: Given the industry, external factors such as economic cycles, event cancellations, or disruptions in freight transport could pose risks. Also, reliance on a single director and small employee base may affect operational resilience.

---

4. Recommendations: Actions to Improve Financial Wellness

• Improve Debtor Management:
  Implement stricter credit control procedures to reduce days sales outstanding (DSO). Healthy cash flow depends on timely collection of receivables. Consider offering early payment discounts or improving credit checks.

• Cash Flow Forecasting:
  Develop rolling cash flow forecasts to anticipate liquidity needs, especially as the company grows or takes on larger contracts in volatile sectors.

• Increase Cash Reserves:
  Consider retaining more cash reserves to buffer against sectoral risks and unforeseen expenses, given the decrease in cash from 2021 to 2022.

• Diversify Revenue Streams:
  Explore new markets or services within event catering and freight to reduce sector-specific risk and smooth income volatility.

• Strengthen Governance:
  As the company grows, consider appointing additional directors or advisors to enhance management oversight and strategic planning.

• Profit & Loss Transparency:
  Even though exempt, consider voluntarily producing detailed profit and loss statements for internal management to monitor profitability trends closely.

---

Summary of Financial Health

Ligabue UK Limited shows strong financial "vital signs" with solid liquidity and a growing equity base, indicating a generally healthy financial condition. The company demonstrates symptoms of growth and good management of liabilities but should be vigilant about debtor control and cash reserves to sustain this positive trajectory. With prudent financial management and strategic oversight, the prognosis for continued financial wellness is positive.

---