LOOP ASSET MANAGEMENT LIMITED

Executive Summary

LOOP ASSET MANAGEMENT LIMITED exhibits typical characteristics of a start-up with healthy short-term liquidity but limited equity and notable long-term debt. While the company can comfortably meet near-term obligations, strengthening its equity base and managing long-term liabilities are crucial to sustaining financial health as it scales. Proactive cash flow management and measured growth will support a positive financial prognosis.

LOOP ASSET MANAGEMENT LIMITED - Analysis Report

Company Number: 15362305

Analysis Date: 2025-07-19 12:05 UTC

Financial Health Assessment: LOOP ASSET MANAGEMENT LIMITED

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1. Financial Health Score: C

Explanation:
Given the company’s very early stage (incorporated December 2023) and micro-entity size, the financial data indicates a business in its infancy with limited operational history. The positive net current assets and positive net assets are good signs, but the extremely low equity base (£231) and the relatively high long-term creditor balance (£50,000) highlight early-stage financial constraints. This results in a "C" grade—stable but with clear room for strengthening the financial foundation.

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2. Key Vital Signs

Metric	Value	Interpretation
Share Capital	£100	Minimal equity injection, typical for a start-up.
Fixed Assets	£702	Small investment in long-term assets, suggests limited physical resources.
Current Assets	£60,900	Healthy short-term assets, primarily cash or receivables.
Current Liabilities	£11,800	Short-term debts manageable relative to current assets.
Net Current Assets	£49,684	Positive working capital, indicating a healthy short-term liquidity position.
Creditors > 1 year	£50,000	Significant long-term liabilities, a potential burden if not carefully managed.
Net Assets (Equity)	£231	Very low net equity, indicating near break-even or limited retained earnings.
Average Employees	2	Small workforce, consistent with micro-entity status.

Interpretation:
The company shows a "healthy cash flow" symptom through a robust net current asset position, indicating it can cover short-term obligations comfortably. However, the "symptom of distress" is visible in the very low shareholders’ funds and the notable long-term creditor balance, which could pressure financial stability if not addressed.

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3. Diagnosis

LOOP ASSET MANAGEMENT LIMITED is in the nascent phase of its business lifecycle. The financial "vitals" reflect a start-up with initial capital and some working capital but limited equity cushion. The positive net current assets suggest the company can meet immediate obligations without strain, indicating no liquidity crisis at this point. However, the minimal equity and substantial long-term liabilities resemble a "thin financial membrane"—there is little buffer to absorb shocks or unexpected expenses.

The business’s reliance on creditors for long-term financing could be a concern if revenue generation does not grow as projected. This places emphasis on cash flow management and careful monitoring of debt servicing capabilities.

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4. Recommendations

• Strengthen Equity Base: Consider augmenting shareholders’ funds through additional capital injection to build a stronger financial "immune system" that can withstand operational pressures.

• Manage Long-term Debt: Engage with creditors to review terms of the £50,000 long-term liabilities. Exploring restructuring or phased repayments can alleviate future financial strain.

• Cash Flow Monitoring: Maintain rigorous cash flow forecasts and controls to ensure the "healthy cash flow" symptom persists, preventing liquidity stress.

• Operational Scaling: With only two employees, carefully plan growth to ensure expenses align with revenue increases, avoiding premature overextension.

• Regular Financial Reviews: Schedule periodic financial health check-ups to catch early signs of distress, enabling proactive management actions.

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