NEWCASTLE SWIM TEAM

Executive Summary

Newcastle Swim Team is financially healthy for a newly established micro-entity, showing strong liquidity, profitability, and a stable equity base. With prudent management and strategic planning, the company is well-positioned for sustainable growth, although its young age requires careful ongoing financial monitoring. Implementing asset development and income diversification will further enhance resilience and financial wellness.

NEWCASTLE SWIM TEAM - Analysis Report

Company Number: 14573945

Analysis Date: 2025-07-29 21:00 UTC

Financial Health Assessment: Newcastle Swim Team (As of 31 December 2023)

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1. Financial Health Score: B

Explanation:
Newcastle Swim Team exhibits a solid financial footing for a newly incorporated micro-entity. The company shows a healthy profit margin, positive net current assets (working capital), and a strong equity base without reliance on long-term debt. The relatively large cash and current asset position compared to liabilities suggests good liquidity. However, as a young organisation with one year of financial history and no fixed assets, some caution is warranted before awarding a top grade.

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2. Key Vital Signs

Vital Sign	Figure	Interpretation
Turnover (Revenue)	£345,835	Good initial sales income for a start-up in the sports club sector.
Other Income	£82,465	Additional income supporting operations; diversification of income.
Profit	£87,892	Positive bottom line indicates sound cost management and viable business model.
Current Assets	£114,558	Sufficient liquid assets to cover short-term needs.
Current Liabilities	£27,083	Manageable short-term obligations, low relative to assets.
Net Current Assets	£87,892	Positive working capital, signaling ability to meet immediate debts.
Shareholders Funds	£87,892	Equity base matches net current assets, no debt on the books, indicating financial stability.
Employees	10	Moderate staffing level consistent with micro-entity size.
Company Age	1 year	Very young company; limited financial history impacts prognosis.

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3. Diagnosis: What the Financial Data Reveals

• Healthy Cash Flow and Liquidity: The company’s current assets exceed current liabilities by over £87k, indicating a strong liquidity position—a key "vital sign" of financial health. This means Newcastle Swim Team can comfortably cover its short-term obligations without distress.

• Profitability: Achieving an £87.9k profit in its first full year demonstrates efficient operations and a sustainable business model. The profit margin relative to turnover is approximately 25%, which is a positive "symptom" indicating good cost control and revenue generation.

• Balance Sheet Strength: The absence of long-term debt and a positive shareholders’ fund balance indicate a clean financial foundation with no immediate solvency concerns. The equity base serves as a financial "immune system," shielding the business from shocks.

• Micro-Entity Status: As a micro-entity, the company benefits from simplified reporting but this also means less detailed financial transparency. The absence of fixed assets may reflect the nature of the business (likely service-focused) or early stage investment cycle.

• Governance and Management: The board comprises a diverse team including legal, finance, and technical expertise, which bodes well for good governance and strategic oversight.

• Age and Future Risks: Being only one year old, the company is in the "infant stage" of its lifecycle, so it remains vulnerable to market fluctuations or unexpected expenses. Continued monitoring is essential.

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4. Recommendations to Improve Financial Wellness

• Build Fixed Assets or Reserves: Consider investing in tangible assets or increasing reserves to strengthen the asset base and support future growth.

• Diversify Income Streams: While current other income is healthy, exploring new revenue sources will reduce risk and enhance resilience.

• Monitor Working Capital: Maintain rigorous tracking of current assets and liabilities to avoid liquidity crunches as the business expands.

• Plan for Growth: Develop a multi-year financial plan including budgeting for increased staff, marketing, and infrastructure to sustain and accelerate growth.

• Regular Financial Review: Given the company’s youth, schedule periodic financial health reviews to detect early signs of distress ("symptoms") and adjust strategies proactively.

• Compliance and Reporting: Ensure ongoing compliance with filing deadlines and consider voluntarily adopting more detailed financial reporting as the company scales.

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