P C HEATING & GAS SERVICES LTD

Executive Summary

P C HEATING & GAS SERVICES LTD is a young micro-entity showing typical early-stage financial traits with modest fixed assets and limited liquidity. While currently solvent, negative working capital signals potential cash flow challenges ahead. Focused management of short-term assets and liabilities, alongside gradual business growth, will be critical for strengthening financial health and ensuring sustainable operations.

P C HEATING & GAS SERVICES LTD - Analysis Report

Company Number: 13840826

Analysis Date: 2025-07-20 11:13 UTC

Financial Health Assessment: P C HEATING & GAS SERVICES LTD

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1. Financial Health Score: C

Explanation:
The company is in its early stages, having been incorporated in 2022, and reports modest asset levels with limited current assets and notable short-term liabilities. While shareholders’ funds are positive, indicating some equity buffer, the balance sheet reveals symptoms typical of a young micro-entity with limited operating history and financial scale. The score of C reflects a stable but nascent financial position with potential for growth, yet also some caution due to limited liquidity and working capital.

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2. Key Vital Signs

Metric	Value (2024)	Interpretation
Fixed Assets	£9,967	Represents investment in long-term assets, healthy for a startup in plumbing and heating.
Current Assets	£180	Very low cash/debtors stock; indicates limited liquid resources available for short-term needs.
Current Liabilities	£8,126	Short-term debts are notable compared to current assets, indicating potential liquidity strain.
Net Current Assets (Working Capital)	-£7,946	Negative working capital is a warning sign; company may struggle to meet short-term obligations.
Net Assets (Equity)	£2,021	Positive but small equity base; shows some owner investment and retained value.
Employees	1	Very small workforce consistent with micro-entity status.

Interpretation:

• Healthy Cash Flow Indicator: The very low current assets against current liabilities suggest symptoms of cash flow stress. The company may rely on owner funds or credit terms to cover short-term obligations.
• Asset Base: The presence of fixed assets (~£10k) shows tangible investment in equipment, supporting operational capability.
• Equity Position: Positive net assets indicate the company is not insolvent, but the low figure reflects limited financial resilience.
• Liquidity Concern: Negative working capital is a symptom of potential distress if not managed carefully.

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3. Diagnosis

P C HEATING & GAS SERVICES LTD is a newly established micro private limited company operating in the plumbing and heating installation sector. The financial vitals suggest:

• The business is in a startup phase with minimal operating history and scale.
• The company has invested in fixed assets required for its trade but holds minimal liquid funds or receivables.
• Short-term liabilities exceed current assets, indicating the company may be under pressure to meet immediate obligations, a symptom of liquidity risk.
• Positive equity shows the owner has injected or retained funds in the business, supporting solvency.
• Only one employee suggests a very small operation with limited overheads.

Overall, the company exhibits early-stage financial characteristics with some risks around cash flow and working capital management but no critical distress signals such as net liabilities or insolvency.

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4. Recommendations

To improve financial wellness and mitigate risks:

• Improve Liquidity: Focus on increasing current assets by building cash reserves or accelerating receivables collection to address negative working capital.
• Manage Payables: Negotiate longer payment terms with suppliers to align outflows better with inflows, easing short-term pressure.
• Monitor Cash Flow Closely: Establish detailed cash flow forecasting and budgeting to anticipate shortfalls and plan funding needs proactively.
• Explore Funding Options: Consider small business loans or overdrafts as a cushion against liquidity fluctuations, ensuring terms do not overburden finances.
• Build Business Scale: Gradually increase sales and operational capacity to grow assets and equity base, enhancing financial stability.
• Maintain Accurate Records: Continue compliance with filing deadlines to avoid penalties and maintain good standing.

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