NALME LTD

Executive Summary

NALME LTD exhibits a healthy financial condition with strong liquidity, positive net assets, and good compliance discipline, reflecting sound financial "vital signs." The company’s small scale and concentrated control pose operational risks, but its stable cash position and equity base provide a solid foundation. Focused efforts on building operational capacity and asset strength will enhance its resilience and growth prospects.

NALME LTD - Analysis Report

Company Number: 14401778

Analysis Date: 2025-07-20 18:14 UTC

Financial Health Assessment for NALME LTD

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1. Financial Health Score: B

Explanation:
NALME LTD demonstrates a solid financial foundation with positive net assets and increasing working capital over the last two reported years. The company is micro-sized, operating with minimal fixed assets but maintains healthy liquidity and shareholder equity. The absence of liabilities beyond current obligations and a clean compliance record add to its financial robustness. However, as a very small entity with limited asset base and only one employee, the business remains vulnerable to operational risks and market changes, warranting a cautious grade of B.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Fixed Assets	453	768	Very low, indicating minimal investment in long-term assets — typical for service/consultancy.
Current Assets	50,707	36,456	Healthy and growing cash/debtors, showing good liquidity.
Current Liabilities	17,431	12,847	Manageable short-term debts, increased but proportionate to assets.
Net Current Assets (Working Capital)	33,276	23,609	Strong positive working capital, indicating good short-term financial health and ability to cover immediate obligations.
Net Assets (Equity)	33,729	24,377	Positive and increasing net assets, reflecting retained earnings and capital injections.
Employee Count	1	1	Very small workforce, implying limited operational scale and potentially higher dependency on key personnel.
Compliance Status	On time filings	On time filings	No overdue accounts or confirmation statements, reflecting good governance discipline.
Ownership Concentration	Single Director/Controller	Single Director/Controller	High control concentration may streamline decision-making but also concentrates risk.

Interpretation:
The company’s "vital signs" resemble a patient with a healthy pulse and stable blood pressure — its liquidity and equity levels are strong, but the very small scale and minimal asset base suggest limited buffer against shocks.

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3. Diagnosis

Underlying Business Health:
NALME LTD appears financially stable and solvent with a positive net asset base and increasing working capital. The increase in current assets and net assets year-over-year suggests profitability or capital injection, although detailed profit/loss data is not disclosed due to micro-entity reporting exemptions. The company’s small size and very limited fixed assets are consistent with its industry (consulting and IT services), which typically require less capital investment.

Symptoms of Distress:
No immediate financial distress symptoms are evident. There are no overdue filings, no excessive liabilities, and the company maintains adequate liquidity. However, the dependence on a single director and employee presents operational risk (akin to a patient with a strong heart but vulnerable due to reliance on a single organ).

Potential Risks:

• Concentrated control and operational dependency on one individual could pose continuity risks if that person is unavailable.
• Limited asset base may restrict borrowing capacity or ability to scale quickly.
• Micro-entity status limits financial transparency, so external stakeholders may find it challenging to assess detailed profitability and cash flow health.

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4. Recommendations

1. Strengthen Operational Resilience:
   Consider broadening the management team or hiring additional staff to reduce dependency on a single individual, improving business continuity and reducing "single point of failure" risk.

2. Build Asset Base or Reserves:
   Explore opportunities to accumulate reserves or invest in tangible/intangible assets (software, intellectual property, equipment) relevant to the business to improve long-term stability and borrowing capacity.

3. Maintain Robust Cash Flow Management:
   Continue monitoring working capital closely, ensuring that receivables are collected promptly and liabilities managed efficiently to maintain liquidity.

4. Prepare for Growth:
   Develop a strategic plan for scaling operations, including marketing, client acquisition, and potential diversification to mitigate risk inherent in a small client base or limited services.

5. Transparent Record Keeping:
   Although exempt from audit, maintaining comprehensive internal financial records will help in strategic decision-making and facilitate future funding or expansion.

6. Compliance Vigilance:
   Keep filing accounts and confirmation statements timely to avoid penalties and maintain trust with suppliers, clients, and financial institutions.

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