NAVIGATE PARTNERS LTD

Executive Summary

Navigate Partners Ltd maintains a generally healthy financial position with strong cash reserves and positive equity. However, the significant rise in current liabilities and receivables signals emerging liquidity risks that warrant close management attention. By improving debtor collections and controlling short-term debts, the company can sustain its financial wellness and growth trajectory.

NAVIGATE PARTNERS LTD - Analysis Report

Company Number: 12583808

Analysis Date: 2025-07-29 14:53 UTC

Financial Health Assessment: NAVIGATE PARTNERS LTD (as of 31 May 2024)

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1. Financial Health Score: B

Explanation:
The company shows generally sound financial health with positive net assets and a stable equity base. However, there is a notable increase in current liabilities and a significant jump in cash and debtors, indicating some potential liquidity management concerns. The overall balance sheet remains robust, but the symptoms suggest caution and the need for careful cash flow monitoring.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Fixed Assets	984	Minimal long-term investment; typical for consultancy.
Current Assets	233,515	Healthy level, increased sharply from previous year.
Cash	113,902	Strong cash position, critical for operational liquidity.
Debtors	119,613	High receivables; risk of delayed payments.
Current Liabilities	196,646	Substantial short-term obligations; increased significantly.
Net Current Assets	36,869	Positive working capital, but reduced from prior year.
Net Assets / Shareholders' Funds	37,853	Stable equity indicating solvency and retained earnings.
Average Employees	2	Small team, consistent with micro/small company profile.

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3. Symptoms Analysis

• Liquidity:
  The company holds a strong cash reserve (£113,902) and sizable current assets, which is a sign of "healthy cash flow". However, the leap in current liabilities to £196,646 (up from £45,323) is a "symptom of distress" that needs investigation. This may indicate increased short-term debts or payables, potentially straining liquidity if not managed carefully.

• Receivables Management:
  Debtors nearly doubled from £61,717 to £119,613, suggesting longer payment terms or slower collections. This could delay cash inflows, stressing working capital.

• Working Capital:
  Despite increased liabilities, net current assets remain positive (£36,869), indicating the company can meet its short-term obligations but with reduced buffer compared to the previous year (£39,818).

• Profitability and Retained Earnings:
  While the profit and loss statement wasn't provided, retained earnings decreased slightly from £40,078 to £37,553, hinting at a small loss or dividend payout. The company's equity remains solid but should be monitored.

• Asset Utilization:
  Fixed assets are minimal and consistent with the company's consultancy nature, which is typical and not a concern.

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4. Diagnosis

NAVIGATE PARTNERS LTD is financially solvent and stable but showing early warning signs of liquidity pressure due to the sharp increase in current liabilities and receivables. The company’s "financial pulse" remains strong due to healthy cash holdings and positive net assets, but the "symptoms" suggest the management should be vigilant about cash conversion cycles and short-term debt management.

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5. Prognosis

If the company improves debtor collections and manages short-term liabilities prudently, it can maintain its good financial health and continue steady operations. Failure to address the rising current liabilities or prolonged receivables could lead to cash flow stress, potentially impairing operational capabilities.

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6. Recommendations

• Enhance Debtor Management:
  Implement stricter credit control policies to reduce receivables aging and improve cash inflow timing.

• Monitor Current Liabilities:
  Review the nature of increased current liabilities to identify if any can be renegotiated or deferred to ease short-term cash demands.

• Cash Flow Forecasting:
  Establish regular cash flow forecasts to anticipate liquidity needs and avoid surprises.

• Cost Control:
  Assess operating expenses for potential reduction, particularly given the small team size, to preserve margins.

• Financial Reporting:
  Consider producing an internal profit and loss statement regularly to better understand profitability trends and guide decisions.

• Contingency Planning:
  Prepare a plan for accessing short-term finance if unexpected liquidity challenges arise.

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