MICHAEL HOBBS LANDSCAPE GARDENS AND DESIGN LIMITED

Executive Summary

MICHAEL HOBBS LANDSCAPE GARDENS AND DESIGN LIMITED is currently in a fragile financial state, with negative net assets and liquidity challenges signaling distress. While compliant with filings, the company needs urgent focus on cash flow management, capital infusion, and profitability improvements to restore financial health and ensure sustainability.

MICHAEL HOBBS LANDSCAPE GARDENS AND DESIGN LIMITED - Analysis Report

Company Number: 12596676

Analysis Date: 2025-07-20 13:58 UTC

Financial Health Assessment for MICHAEL HOBBS LANDSCAPE GARDENS AND DESIGN LIMITED

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1. Financial Health Score: D

Explanation:
The company shows signs of financial distress with negative net assets and persistent liabilities exceeding assets in recent years. Although it remains active and filing accounts on time, the declining equity and working capital issues indicate a fragile financial condition needing urgent attention.

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2. Key Vital Signs (Financial Metrics & Interpretation):

Metric	2024 Value	Interpretation
Net Assets	£-5,260	Negative net assets indicate the company’s liabilities exceed its assets, a key symptom of distress.
Current Liabilities	£11,210	Current liabilities remain significant, requiring sufficient short-term assets to cover debts.
Net Current Assets	£-11,210	Negative net current assets suggest poor liquidity and potential difficulty meeting short-term obligations.
Fixed Assets	£5,850	Low fixed asset base, typical for a micro business; no significant investment in long-term assets.
Share Capital	£1.00	Minimal paid-up share capital, limiting financial cushion.
Employee Count	1	Single employee indicates a micro-sized operation, likely owner-managed.
Filing Status	Up to date	No overdue filings, indicating compliance with statutory requirements.

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3. Diagnosis: What the Financial Data Reveals

The company exhibits symptoms of financial strain. Negative net assets and negative working capital over consecutive years are red flags, suggesting that the business is operating with insufficient liquidity and accumulated losses. These symptoms could reflect issues such as:

• Insufficient profitability or operating losses eroding shareholder equity.
• Possible reliance on short-term credit or delayed payments to suppliers.
• Limited financial reserves and low capital buffer, increasing vulnerability to cash flow shocks.

The slight improvement in fixed assets from £0 to £5,850 in 2024 shows some investment, but it is small and unlikely to offset the liquidity and solvency concerns. The business remains small and owner-managed, which may limit access to external funding or scale advantages.

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4. Recommendations: Specific Actions to Improve Financial Wellness

• Improve Cash Flow Management:
  Aim to convert receivables faster and manage payables prudently to avoid liquidity crunch. Consider negotiating longer payment terms with suppliers or upfront payments from customers.

• Increase Capital Injection:
  Infuse additional equity capital to restore positive net asset position and strengthen the financial base. This could be through personal investment or external investors.

• Cost Control and Profitability Focus:
  Review operational expenses and pricing strategy to improve margins. Small businesses often suffer from underpricing or uncontrolled overheads.

• Seek Professional Financial Advice:
  Engage an accountant or financial advisor to set up budgets, forecasts, and monitor key financial ratios regularly to detect early warning signs.

• Explore Funding Options:
  Investigate small business loans, grants, or government support schemes designed for micro enterprises to ease cash flow pressures.

• Maintain Compliance:
  Continue timely filing of statutory accounts and confirmation statements to avoid penalties and maintain good standing.

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Medical Analogy Summary

The company’s financial health shows symptoms of distress similar to a patient with low blood pressure and poor circulation: the "heart" (cash flow) struggles to keep "organs" (creditors, operations) adequately supplied. Without intervention, the condition could worsen, risking insolvency. Prompt "treatment" to boost liquidity and capital is critical for recovery.

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