MAHUYAR UK LTD

Executive Summary

MAHUYAR UK LTD exhibits a solid fixed asset base but suffers from serious liquidity issues, with current liabilities significantly exceeding current assets, leading to negative working capital. The company’s financial condition is fragile with minimal equity buffers, requiring urgent focus on cash flow management and debt restructuring to ensure sustainable operations. Without intervention, liquidity pressures could escalate, threatening ongoing viability.

MAHUYAR UK LTD - Analysis Report

Company Number: 14147871

Analysis Date: 2025-07-29 13:54 UTC

Financial Health Assessment for MAHUYAR UK LTD

---

1. Financial Health Score: D

Explanation:
The company shows signs of financial strain with net current liabilities and very thin net equity. While the fixed assets base is substantial, the company's liquidity position is weak, and shareholders' funds are barely positive after recovering from a negative net asset position. This indicates the company is struggling to maintain a healthy financial balance and is at risk of cash flow distress if current liabilities demand immediate settlement.

---

2. Key Vital Signs

Metric	2024-06-30 (£)	Interpretation
Fixed Assets	548,254	Strong long-term asset base, likely property or leased real estate relevant to core operations.
Current Assets	11,794	Very low liquid assets to cover short-term obligations.
Current Liabilities	201,558	High short-term debts that significantly exceed current assets, creating liquidity strain.
Net Current Assets (Working Capital)	-189,764	Negative working capital indicates difficulty meeting short-term liabilities; symptom of cash flow problems.
Creditors (Due after 1 year)	356,823	Large long-term liabilities, indicating significant debt burden.
Net Assets (Shareholders' Funds)	1,667	Barely positive equity, showing minimal buffer against losses; very thin capitalization.
Profit & Loss Reserve	Not explicitly stated, but implied negative in prior years, now marginally positive.

Additional Notes:

• No employees, indicating minimal operational overhead.
• Micro-entity status with exemption from audit, standard for small companies with limited complexity.
• The company is in the real estate letting sector (SIC 68209), so fixed assets could be property holdings.
• Directors hold equal significant control (25-50%), indicating concentrated ownership.

---

3. Diagnosis

The financial "vital signs" reveal symptoms of distress mainly due to liquidity challenges: the company’s current liabilities far outstrip its current assets, leaving a negative working capital position. This is analogous to a patient with a healthy skeleton (fixed assets) but weak blood circulation (cash and liquid resources), which impairs the ability to meet immediate demands.

The large long-term liabilities suggest the company has a significant debt load, possibly related to financing the fixed assets (e.g., mortgage or lease obligations). Despite this, the company has managed to improve its net asset position from negative to slightly positive over the last year, indicating some recovery or possible capital injections.

However, the minimal net equity means the company has very little financial "cushion" to absorb shocks or losses. The absence of employees suggests the company’s operations are either minimal or outsourced, which might reduce costs but also indicates limited operational activity or scale.

Overall, the company’s financial health resembles a patient with chronic but manageable condition: the structural assets are intact, but the liquidity and equity buffer are weak, requiring careful management to avoid a crisis.

---

4. Recommendations

1. Improve Liquidity Management:

   • Increase current assets, particularly cash reserves, to better cover current liabilities and avoid liquidity crises.
   • Consider restructuring short-term debts to longer maturities to ease immediate cash flow pressures.

2. Debt Restructuring:

   • Negotiate with creditors to manage or refinance the large long-term liabilities, potentially reducing interest costs or extending payment terms.
   • Evaluate options for equity injections or capital restructuring to strengthen net assets.

3. Operational Review:

   • Assess revenue generation and operational efficiencies to boost cash inflows.
   • Explore active management or monetization of fixed assets if underutilized.

4. Financial Monitoring:

   • Implement regular financial reviews focusing on cash flow forecasts and working capital metrics to detect early signs of distress.
   • Engage with financial advisors or turnaround specialists if liquidity problems persist.

5. Governance & Transparency:

   • Maintain open communication with stakeholders about financial status and plans to improve stability.
   • Ensure compliance with filing deadlines to avoid penalties and preserve corporate reputation.

---