MAX MACALLAN LIMITED

Executive Summary

MAX MACALLAN LIMITED has demonstrated a significant recovery in financial health with improved liquidity and equity positions after previous distress. While the company remains small and capital-light, its stable cash reserves and positive working capital signal a healthy operational footing. Strategic focus on cash management, income diversification, and governance will further enhance financial resilience and growth prospects.

MAX MACALLAN LIMITED - Analysis Report

Company Number: SC683834

Analysis Date: 2025-07-29 20:22 UTC

Financial Health Assessment: MAX MACALLAN LIMITED

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1. Financial Health Score: B

Explanation:
MAX MACALLAN LIMITED shows clear signs of recovery and improved financial stability compared to prior years. The company has positive net current assets and net assets in the most recent year, indicating a healthier liquidity and equity position. However, the relatively small scale of operations, low share capital, and limited fixed asset base suggest moderate financial robustness typical of a small creative enterprise. The absence of detailed profit & loss data limits a full profitability assessment, but the balance sheet signals stable footing.

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2. Key Vital Signs

Metric	2023 Value (£)	2021 Value (£)	Interpretation
Fixed Assets (Tangible)	3,768	5,024	Decrease reflects asset usage or disposals; small asset base typical for artistic sector.
Current Assets	3,682	5,884	Decrease but remains sufficient to cover short-term liabilities.
Cash at Bank	3,279	5,085	Healthy cash reserve supporting day-to-day operations.
Debtors	403	799	Low receivables, indicating tight credit control or low sales volume.
Current Liabilities	3,664	10,678	Significant reduction, relieving liquidity pressure.
Net Current Assets	18	(4,794)	Shift from working capital deficit to slight surplus—critical sign of improved liquidity.
Net Assets/Shareholders’ Funds	3,786	230	Strong improvement, reflecting retained earnings or capital injections.
Share Capital	1	2	Minimal capital; typical for small private companies.

Interpretation of Vital Signs:

• The net current assets transitioning from negative to positive shows the company has overcome previous liquidity distress, akin to a patient whose vital signs have stabilised after a critical episode.
• The modest fixed asset base and small equity reflect the company's micro/small size and artistic nature, where heavy investments in tangible assets are not typical.
• Cash reserves are adequate, indicating healthy cash flow management and ability to meet imminent obligations.

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3. Diagnosis

Underlying Business Health:
The financial data reveals a company recovering well from earlier financial stress. The significant reduction in current liabilities and improvement in net current assets suggest the company has addressed past liquidity "symptoms of distress"—likely through better cash flow management or debt restructuring.

However, the small scale of operations (low fixed assets and share capital) means the business remains vulnerable to external shocks and cash flow variability. The company's reliance on a single director and a majority shareholder (holding 75-100% shares) indicates concentrated control but could pose governance risks.

The company's classification in artistic creation and other business support services suggests it operates in a niche, likely with limited capital intensity but sensitive to market demand fluctuations.

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4. Recommendations

To maintain and improve financial wellness, MAX MACALLAN LIMITED should consider the following steps:

1. Strengthen Working Capital Management:
   Ensure continued monitoring of receivables and payables to maintain the positive net current asset position. Avoid overextending credit to customers.

2. Build Cash Reserves:
   Aim to increase cash buffer to provide a safety net against unforeseen expenses or revenue shortfalls, enhancing liquidity resilience.

3. Diversify Income Streams:
   Explore additional artistic or support service offerings to reduce dependency on limited revenue sources, improving financial stability.

4. Governance and Succession Planning:
   With a single director and sole significant controller, consider formalising governance structures and planning for continuity to mitigate operational risks.

5. Consider Capital Injection or Retained Earnings Growth:
   Although current equity is positive, incremental capital or reinvestment of profits can strengthen the balance sheet, enabling potential growth or buffering against downturns.

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Executive Summary