LION ACADEMY LTD

Executive Summary

LION ACADEMY LTD is in a vulnerable financial position typical of a young start-up, with negative net assets and tight liquidity. Focused actions on enhancing cash flow, building equity, and developing revenue streams are critical to improve its financial health and ensure sustainable growth.

LION ACADEMY LTD - Analysis Report

Company Number: 15163276

Analysis Date: 2025-07-20 18:24 UTC

Financial Health Assessment of LION ACADEMY LTD

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1. Financial Health Score: D

Explanation:
The company shows initial operational signs but exhibits a fragile financial position with net liabilities, indicating early distress symptoms. The micro entity’s financials reveal a near-zero working capital and negative net assets, which limit resilience against unexpected expenses or operational hiccups. Given the company's infancy (incorporated in late 2023) and minimal financial activity, this grade reflects the precarious state typical of start-up phases but warrants close monitoring.

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2. Key Vital Signs

Metric	Value	Interpretation
Current Assets	£3,002	Represents cash or short-term receivables; very low absolute liquidity.
Current Liabilities	£3,032	Short-term debts nearly equal to assets, creating tight liquidity.
Net Current Assets (Working Capital)	-£30	Negative indicates inability to cover short-term obligations comfortably.
Net Assets / Shareholders’ Funds	-£30	Negative equity suggests company owes more than it owns—early distress sign.
Profit & Loss Account	Not filed	No reported profits or losses yet; performance data unavailable.
Employee Count	0	No staff employed, indicating minimal operational scale currently.
Account Category	Micro	Simplified reporting but limited financial detail available.
Company Age	~1 year	Early stage, typically volatile financial position.

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3. Diagnosis: What the Numbers Reveal

• Fragile liquidity ("cash flow pulse"): The company's current assets barely cover its immediate liabilities, with a net working capital of -£30. This is akin to a patient with a weak pulse — the business can barely meet short-term debts, posing risks if any unexpected expenses arise.

• Negative equity ("balance sheet anemia"): With net assets at -£30, the company is technically insolvent on paper, though this is marginal and may reflect initial setup costs or timing of transactions rather than ongoing distress. Still, this is a warning sign that needs addressing.

• No operational scale ("zero employment metabolism"): Having no employees implies the company is likely in a pre-revenue, development, or planning phase. This limits cash burn but also revenue generation capacity.

• Limited financial history ("new patient"): Being incorporated late 2023, the company is in its infancy. Early financial data often show instability; thus, the current position may improve as the company progresses.

• Industry diversity: Activities span education, advertising, and software development, indicating potential multiple revenue streams but also complexity in operational focus.

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4. Recommendations: Prescriptions for Financial Wellness

• Improve working capital ("strengthen the heartbeat"): Seek to increase current assets (cash or receivables) or reduce current liabilities through cost control or renegotiation of payment terms to ensure short-term obligations are comfortably met.

• Build equity ("restore blood volume"): Consider additional capital injections or retained earnings accumulation to move net assets into positive territory, improving solvency and creditworthiness.

• Generate revenue streams ("start metabolism"): Focus on commercialising services or products swiftly to transition from start-up stage to operational business with income inflows.

• Maintain compliance ("regular health checks"): Continue timely filing of accounts and confirmation statements to avoid penalties or reputational damage.

• Monitor cash flow closely ("vital signs monitoring"): Regularly forecast cash inflows and outflows to anticipate liquidity needs and avoid distress.

• Clarify strategic focus: Harmonise business activities to ensure resources are efficiently deployed, avoiding dilution of effort across diverse sectors.

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Executive Summary:
LION ACADEMY LTD, newly formed and classified as a micro entity, currently exhibits fragile financial health with negative net assets and minimal liquidity, typical for a start-up in its early stage. Immediate focus on improving working capital, building equity, and generating revenue will be essential to stabilize and strengthen its financial condition.