MASTERS OF INDUSTRY LIMITED

Executive Summary

MASTERS OF INDUSTRY LIMITED is currently facing significant financial distress as evidenced by negative working capital and shareholders' funds, indicating liquidity challenges and erosion of equity. Immediate focus on liquidity management, cost control, and capital strengthening is critical to stabilize the company’s financial health and mitigate insolvency risks.

MASTERS OF INDUSTRY LIMITED - Analysis Report

Company Number: 12442134

Analysis Date: 2025-07-29 15:13 UTC

Financial Health Assessment for MASTERS OF INDUSTRY LIMITED

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1. Financial Health Score: D

Explanation:
The company currently exhibits signs of financial distress, primarily due to a significant deterioration in liquidity and net asset position as of the latest financial year. The net liabilities and negative shareholders’ funds are concerning "symptoms" that indicate underlying financial health challenges. Although the company remains active, these financial indicators suggest a weakened financial state that needs urgent attention.

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2. Key Vital Signs (Critical Metrics and Interpretation):

Metric	2023 Value	Interpretation
Fixed Assets	£13,432	Small but growing investment in long-term assets; relatively stable but minimal asset base.
Current Assets	£2,914	Drastic fall from £94,380 (2022); indicates a sharp decline in liquid resources and receivables.
Current Liabilities	£45,726	Decreased from previous year but still high relative to current assets, indicating liquidity pressure.
Net Current Assets	-£42,812	Negative working capital (current assets minus current liabilities) - symptoms of liquidity distress.
Net Assets (Shareholders Funds)	-£44,380	Shifted from positive £4,161 (2022) to negative; signals erosion of equity and potential insolvency risk.
Employee Count	1 (2023)	Reduced workforce suggests cost-cutting or downsizing possibly due to financial constraints.

Key Interpretation:

• The "healthy cash flow" vital sign is missing this year; the company’s current assets no longer cover short-term debts, indicating cash flow strain.
• Negative net current assets and net liabilities point to a "symptom of distress" where the company may struggle to meet immediate obligations.
• The significant drop in current assets could indicate collection issues or asset sales.
• Shareholders’ funds moving into deficit suggest accumulated losses or write-downs.

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3. Diagnosis: Overall Financial Condition

The financial "diagnosis" for MASTERS OF INDUSTRY LIMITED is one of acute financial stress. The shift from positive net assets and healthy working capital in 2022 to negative values in 2023 is a red flag. This suggests that the company has either experienced significant losses, written down receivables or inventory, or incurred liabilities that have overwhelmed its asset base.

The drastic reduction in current assets is particularly alarming and could indicate poor cash management or operational challenges. The decrease in employee numbers also hints at reduced operational capacity or restructuring measures.

While the company is not in formal liquidation or administration, the financial "symptoms" of liquidity crisis and negative equity place it at risk of insolvency if corrective actions are not taken promptly.

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4. Recommendations: Specific Actions to Improve Financial Wellness

• Liquidity Management:
  Implement stringent cash flow controls and accelerate collection of receivables. Consider negotiating extended payment terms with creditors to ease short-term cash pressures.

• Cost Control:
  Review operating expenses and overheads to align spending with current revenue capacity. The reduction in employees hints at this already, but further efficiency gains may be necessary.

• Capital Injection:
  Explore options for fresh equity investment or shareholder loans to shore up the balance sheet and restore positive net assets.

• Debt Restructuring:
  Engage with creditors to restructure existing liabilities, especially the £15,000 long-term creditors, to improve debt servicing capacity.

• Business Model Review:
  Assess the underlying business strategy and market conditions to identify causes of asset reductions and implement corrective measures.

• Financial Reporting & Monitoring:
  Improve internal financial reporting frequency to monitor vital signs regularly and detect symptoms early.

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Executive Summary