LYNDEN PROJECTS LIMITED

Executive Summary

Lynden Projects Limited is currently financially stable with positive working capital and net assets, reflecting a sound foundation for a micro-sized consultancy. However, a decline in liquidity and net worth highlights emerging financial strain that requires proactive cash flow management and strategic cost control. With timely actions, the company can strengthen its financial health and support sustainable growth.

LYNDEN PROJECTS LIMITED - Analysis Report

Company Number: 14283600

Analysis Date: 2025-07-29 19:54 UTC

Financial Health Assessment of Lynden Projects Limited

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1. Financial Health Score: B

Explanation:
Lynden Projects Limited maintains a solid net asset position with positive working capital and shareholders' funds, reflecting a generally healthy financial foundation for a micro-sized entity. However, the decline in net current assets and net assets over the past year signals some emerging stress that warrants close monitoring.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Current Assets	23,985	33,023	Reduction indicates a decrease in liquid or short-term resources available to meet obligations.
Current Liabilities	9,466	12,184	Decrease in short-term debts is positive, easing immediate repayment pressure.
Net Current Assets	14,939	20,839	Healthy positive working capital, but falling, which may reduce flexibility to cover short-term needs.
Net Assets (Shareholders’ Funds)	14,939	20,839	Net worth remains positive but has declined, suggesting some erosion of retained earnings or capital.
Number of Employees	2	2	Stable workforce size, reflecting consistent operational scale.

Interpretation of Vital Signs:
The company shows "healthy cash flow" signs with positive net current assets, meaning it can cover its immediate liabilities. However, the "symptom of distress" is the noticeable decrease in both current assets and net assets—a signal that the business’s liquidity and overall capital base are being gradually consumed or not growing as expected.

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3. Diagnosis

Lynden Projects Limited, being a micro-entity engaged in engineering and IT consultancy, shows a typical financial profile of a young company (incorporated in 2022) that is building its foundation. The positive net assets and working capital are reassuring signs of solvency and operational soundness.

The decline in current assets and net assets over the last year suggests the company might be experiencing:

• Reduced cash inflow or lower receivables (possibly fewer contracts or delayed payments),
• Increased operational costs not fully matched by revenues,
• Or drawing down of capital reserves to fund operations.

The absence of a profit and loss account (not filed as permitted under micro-entity rules) limits insight into profitability trends, but the reduction in net assets implies retained earnings have decreased or the company has incurred losses.

No audit requirement and exemption reflects the company's micro status, but also means less external assurance on financial robustness.

Overall, the company is "financially stable but with mild warning signs" of declining liquidity and capital that should be addressed to avoid future cash flow stress or solvency concerns.

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4. Recommendations

• Enhance Cash Flow Management:
  Conduct a detailed cash flow forecast to identify timing gaps. Accelerate receivables collection and manage payables prudently to maintain healthy liquidity.

• Review Cost Structure:
  Analyze operating expenses to identify potential cost-saving opportunities without compromising service quality. Consider whether current staffing and overheads align with revenue expectations.

• Increase Revenue Streams:
  Explore diversifying project types or client base in engineering and IT consultancy to stabilize and grow income.

• Build Capital Reserves:
  Retain earnings where possible or consider additional equity funding to strengthen net assets, improving resilience against financial shocks.

• Regular Financial Monitoring:
  Implement monthly financial reviews focusing on working capital and profitability indicators to detect and respond promptly to any adverse trends.

• Seek Professional Advice:
  Engage with financial advisors or accountants to optimize tax planning, funding structure, and financial reporting compliance as the business grows.

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