LYSON SOLUTIONS LTD

Executive Summary

LYSON SOLUTIONS LTD, a newly incorporated micro-entity operating in online retail, currently exhibits negative net assets and working capital, indicating early financial strain. While typical for a startup, these symptoms necessitate proactive liquidity management and capital strengthening to ensure sustainable growth. With focused financial discipline and strategic planning, the company can improve its financial health trajectory.

LYSON SOLUTIONS LTD - Analysis Report

Company Number: 14678807

Analysis Date: 2025-07-29 12:32 UTC

Financial Health Assessment Report for LYSON SOLUTIONS LTD

---

1. Financial Health Score: D

Explanation:
The company shows a negative net asset position with net current liabilities exceeding current assets by £2,275. This indicates early symptoms of financial distress, akin to a patient showing signs of weakness and imbalance in vital signs. Given the company's recent incorporation in 2023 and limited operational history, the financial health is currently fragile but not yet critical.

---

2. Key Vital Signs

Metric	Value	Interpretation
Net Current Assets	-£2,275	Negative working capital; current liabilities exceed current assets, indicating liquidity strain.
Total Net Assets	-£2,275	Overall net liabilities; shareholders' funds are in deficit, showing potential capital insufficiency.
Account Category	Micro	Minimal filing requirements; limited financial disclosure available.
Number of Employees	2	Small workforce consistent with micro-sized company.
Industry (SIC 47910)	Retail sale via mail order or Internet	Online retail business model, often requiring working capital for inventory and marketing.
Company Age	~1 year	Early stage; limited financial track record limits trend analysis.

Interpretation:
The negative net current assets signal a liquidity "arrhythmia" — the company may struggle to meet short-term obligations without additional cash inflows or funding. Negative net assets reflect a "capital deficit," suggesting initial investment or accumulated losses have not yet been overcome.

---

3. Diagnosis

LYSON SOLUTIONS LTD is in the nascent stage of its business lifecycle, reflected in its micro-entity status and recent incorporation. The "symptom" of negative working capital and net assets points to initial financial strain, which is common for startups yet warrants close monitoring. The small scale and limited operational history mean the company may still be in a "growth and establishment" phase, investing resources to build the business.

The lack of positive assets or reserves indicates that financial "resilience" is low; the company could face challenges in absorbing shocks such as delayed customer payments or unexpected expenses. However, no overdue filings or compliance issues are present, which is a positive sign of "administrative health."

---

4. Recommendations

To improve the company's financial wellness and move towards a healthier financial state, consider the following specific actions:

• Strengthen Liquidity:
  Seek additional working capital through shareholder loans, equity injection, or short-term credit lines to cover current liabilities and restore positive net current assets.

• Monitor Cash Flow Closely:
  Implement rigorous cash flow management practices to ensure timely collection of receivables and control of payables, avoiding liquidity crunches.

• Cost Control and Expense Management:
  Review operating expenses carefully to reduce unnecessary costs, preserving cash for critical business activities.

• Build Capital Reserves:
  Focus on achieving profitability and retaining earnings to convert negative net assets into positive shareholders’ funds over time.

• Strategic Planning for Growth:
  Develop a clear business plan to increase sales volume and margin, particularly leveraging the online retail model’s scalability.

• Regular Financial Health Checks:
  Schedule periodic financial reviews to detect early warning signs and adjust strategy promptly, akin to routine health check-ups.

---