LOXLEY BUSINESS SERVICES (COTSWOLDS) LIMITED
Executive Summary
LOXLEY BUSINESS SERVICES (COTSWOLDS) LIMITED is financially solvent but fragile, with very limited assets and a minimal equity base typical of a micro-entity. The recent decline in current assets signals reduced operational activity or cash inflows, placing the company in a vulnerable position. Strengthening cash flow, expanding working capital, and careful financial planning are essential to improve resilience and ensure sustainable business health.
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This analysis is opinion only and should not be interpreted as financial advice.
LOXLEY BUSINESS SERVICES (COTSWOLDS) LIMITED - Analysis Report
Financial Health Assessment for LOXLEY BUSINESS SERVICES (COTSWOLDS) LIMITED
As of financial year ending 31 December 2024
1. Financial Health Score: D
Explanation:
The company exhibits very limited financial resources and a shrinking asset base. While it remains solvent with positive net assets, the extremely low current assets and lack of current liabilities indicate minimal business activity or operational scale. This low level of financial robustness rates as below average for a micro-entity, suggesting vulnerability and limited capacity to withstand financial stress.
2. Key Vital Signs
Metric | 2024 Value | Interpretation |
---|---|---|
Current Assets | £455 | Very low cash/receivables; symptomatic of minimal operational scale or cash flow issues. |
Current Liabilities | £0 | No short-term debts; could indicate conservative management or minimal trade activity. |
Net Current Assets | £455 | Positive but very small working capital; borderline healthy but fragile. |
Net Assets (Equity) | £455 | Extremely low equity base; signals limited financial buffer. |
Shareholders Funds | £455 | Matches net assets, indicating no hidden or complex liabilities. |
Employees | 1 | Micro-entity status confirmed; small operational footprint. |
Trend Observations:
- From 2023 to 2024, current assets dropped sharply from £2,469 to £455.
- Current liabilities decreased from £2,001 to zero, improving liquidity but possibly reflecting reduced operational activity or creditor payments.
- Net assets decreased from £468 to £455, a slight decline but in line with the asset reduction.
3. Diagnosis: Financial Condition and Business Health
The company's financial "vital signs" reflect a fragile but solvent condition, akin to a patient with low but stable blood pressure—functioning but vulnerable. The shrinking current assets suggest either reduced revenue inflows or liquidations of assets to settle payables. The absence of current liabilities in 2024 removes immediate financial obligations, which may be positive but also could indicate a halt or significant slowdown in trading activity.
The minimal equity and net asset base indicate that the company has a very thin financial cushion. This leaves it susceptible to "financial shocks" — unexpected expenses or revenue shortfalls could quickly push the company into distress. The single employee and micro-entity accounting status underline the company's small scale and limited operational complexity.
No audit is required under micro-entity rules, which limits available financial detail, but the micro-entity accounts show no signs of accumulated losses or negative reserves, which is a positive sign. The director, Mrs. Faye Julie Sieracki, holds full ownership and control, suggesting decision-making is centralized.
4. Recommendations: Actions to Improve Financial Wellness
- Enhance Cash Flow Management: The "healthy cash flow" is critical; the company should closely monitor receivables and payables to avoid liquidity crunches. Consider renegotiating payment terms or improving billing efficiency.
- Increase Working Capital: Aim to build current assets, particularly cash or cash equivalents, to strengthen the financial buffer against operational fluctuations. This might involve seeking additional capital injections or improving profitability.
- Diversify Revenue Streams: Limited financial activity suggests dependency on few clients or contracts; broadening the customer base could stabilize income.
- Maintain Compliance and Reporting Discipline: Ensure all filings remain up to date to avoid penalties and maintain credibility with suppliers and creditors.
- Consider Strategic Scaling: Given the micro size, exploring partnerships or outsourcing could help scale operations without large capital expenditure.
- Financial Planning: Develop a simple but robust budget and forecast to anticipate future cash needs and avoid surprises.
- Monitor Director's Liability: As sole director and owner, Mrs. Sieracki should ensure compliance with fiduciary duties to avoid personal risk, particularly in a small entity where financial margins are tight.
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