PACESETTERS GLOBAL LIMITED

Executive Summary

PACESETTERS GLOBAL LIMITED is currently facing liquidity challenges characterized by negative working capital and minimal cash reserves, despite maintaining a positive net asset base. Without improved cash flow management and strategic financial planning, the company risks operational disruption. Prompt actions to enhance liquidity and working capital are essential to restore financial health and support sustainable growth.

PACESETTERS GLOBAL LIMITED - Analysis Report

Company Number: 13176519

Analysis Date: 2025-07-19 13:02 UTC

Financial Health Assessment of PACESETTERS GLOBAL LIMITED

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1. Financial Health Score: D

Explanation:
PACESETTERS GLOBAL LIMITED exhibits clear signs of financial strain, primarily due to persistent negative working capital and minimal cash reserves. While the company maintains a positive net asset position thanks to fixed assets, the lack of liquidity and growing short-term liabilities suggest distress symptoms that could impede day-to-day operations if not addressed promptly.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Cash at bank	50	50	Critically low cash reserves; "starving" cash flow limits operational flexibility.
Current Liabilities	650	350	Increased short-term debts, including director loans, indicating growing immediate obligations.
Net Current Assets	-600	-300	Negative working capital – "symptoms of liquidity distress"; unable to cover short-term debts.
Net Assets (Equity)	1,008	1,844	Positive but declining equity; assets exceed liabilities but erosion is a warning sign.
Tangible Fixed Assets	1,608	2,144	Declining asset base due to depreciation; could affect long-term operational capacity.
Number of Employees	0	0	No employees; may reflect minimal operational activity or reliance on voluntary/outsourced work.

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3. Diagnosis

• Liquidity Concerns: The company’s cash position is critically low (£50), while current liabilities have nearly doubled year-on-year. This creates a "cash starvation" scenario where the company struggles to meet immediate financial obligations, as evidenced by a net current asset deficit of £600. This is a core symptom of financial distress impacting the company’s ability to operate smoothly.

• Working Capital Deficiency: Negative working capital indicates the company’s current liabilities surpass current assets, a classic symptom of financial stress that can lead to payment delays, supplier issues, or increased borrowing costs.

• Equity Erosion: Net assets have fallen from £1,844 to £1,008, showing a decline in retained earnings or asset value. While the company remains solvent on a balance sheet basis, the downward trend is a warning signal for future stability.

• Asset Depreciation: Tangible fixed assets have decreased due to depreciation without apparent reinvestment, potentially weakening the company’s operational capacity or value base.

• Governance and Structure: The company is limited by guarantee with no share capital, which can limit capital-raising options. The directors have provided loans (£350), a sign that internal funding is supplementing operations, which might not be sustainable long-term.

• Operational Activity: No employees are recorded, which may indicate limited operational scale or reliance on external providers. This could reduce fixed overheads but might also limit growth potential.

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4. Recommendations

• Improve Liquidity: Immediate focus should be on increasing cash reserves. This can be pursued via:

  • Negotiating extended payment terms with creditors to ease short-term cash flow.
  • Director or stakeholder injections of funds or short-term loans with clear repayment plans.
  • Exploring grant funding or support schemes available for arts-related activities.

• Strengthen Working Capital Management: Implement tighter control over receivables and payables to reduce the working capital gap. Since the company has no employees, outsourcing expenses should be carefully monitored and minimized.

• Asset Management: Evaluate the necessity and usage of tangible fixed assets. Consider if any non-essential assets can be sold to improve liquidity or if reinvestment might be needed to sustain operations.

• Strategic Financial Planning: Develop a detailed cash flow forecast and budget to monitor ongoing financial health. This should include scenario planning for potential downturns or delays in funding.

• Governance Review: As the company is limited by guarantee, consider whether restructuring to a different company form (e.g., private limited company with share capital) would facilitate future capital raising.

• Operational Assessment: Review business operations to identify opportunities for revenue growth or cost reduction, possibly by expanding service offerings or partnerships within the arts sector.

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