PERFORMANCE TUNE PRO LTD

Executive Summary

Performance Tune Pro Ltd is a young private company showing signs of financial distress with negative net assets and poor liquidity. Immediate actions to improve cash flow, restructure debt, and enhance profitability are critical to stabilize its financial health. With proactive management and strategic interventions, the company can improve its outlook and build a stronger financial foundation.

PERFORMANCE TUNE PRO LTD - Analysis Report

Company Number: 14403311

Analysis Date: 2025-07-20 18:47 UTC

Financial Health Assessment Report for Performance Tune Pro Ltd

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1. Financial Health Score: D

Explanation:
Performance Tune Pro Ltd currently exhibits significant financial distress symptoms, with negative net assets and net current liabilities far exceeding its current assets. While the company is very young (incorporated late 2022) and still building its financial base, the financial "vital signs" suggest poor liquidity and solvency positions which place it in a vulnerable state. The D grade reflects serious concerns requiring prompt management intervention.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Current Assets	2,974	Very low; limited liquid resources available.
Cash	1,574	Insufficient cash buffer for near-term obligations.
Current Liabilities	33,953	High short-term debts; significant pressure on liquidity.
Net Current Assets	-30,979	Negative working capital; company owes much more than it owns short-term.
Fixed Assets (Tangible)	24,091	Assets mostly plant and machinery, partially financed by debt.
Total Assets Less Current Liabilities	-6,888	Negative, indicating liabilities exceed assets even after adjusting for current debts.
Net Assets (Equity)	-23,299	Negative shareholder equity; company is technically insolvent on a balance sheet basis.
Hire Purchase Debt (secured)	19,234	Significant portion of assets financed through secured finance.
Share Capital	1	Minimal equity funding; company is almost entirely debt-financed.

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3. Diagnosis: Financial Health Analysis

Liquidity "Symptoms":
The company shows clear symptoms of liquidity distress. With current liabilities over £33k and cash reserves below £2k, Performance Tune Pro Ltd may struggle to meet short-term obligations as they fall due. The negative net current assets (-£31k) is a strong indicator of cash flow strain.

Solvency "Symptoms":
Negative net assets (-£23k) highlight that liabilities exceed the total assets owned. This "balance sheet insolvency" suggests the company is technically insolvent, raising alarms about long-term viability without intervention. The presence of secured hire purchase contracts totaling over £19k against fixed assets indicates leveraged financing of equipment but also increased obligations.

Growth and Maturity Stage:
Given the company was incorporated in October 2022 and this is its first accounts period, it's common for startups in capital-intensive industries such as vehicle maintenance to have initial losses and heavy borrowing. The director's going concern statement reflects confidence in future cash flows, but the current "vital signs" are weak.

Management and Control:
The sole director and 100% owner, Mr James Ridley Thompson, holds full control and is responsible for steering the company towards improved financial health. The company operates in motor vehicle maintenance, a competitive sector that requires careful financial and operational management.

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4. Recommendations: Prescriptions for Financial Wellness

1. Improve Cash Flow Management:

   • Tighten credit control to accelerate debtor collections.
   • Negotiate extended payment terms with suppliers and creditors to ease short-term liquidity pressure.
   • Consider short-term financing options or overdraft facilities to maintain a healthy cash buffer.

2. Restructure Debt:

   • Assess the feasibility of refinancing hire purchase agreements to reduce short-term liabilities.
   • Explore potential equity injections from the owner or external investors to bolster net assets and reduce dependence on debt.

3. Cost Control and Profitability Focus:

   • Review operating expenses and overheads to identify cost-saving opportunities.
   • Enhance service pricing and marketing efforts to increase turnover and margins.

4. Regular Financial Monitoring:

   • Implement monthly management accounts to track liquidity, profitability, and cash flow.
   • Establish early warning indicators to detect financial distress symptoms promptly.

5. Seek Professional Advice:

   • Engage with financial advisors or accountants to develop a robust financial recovery plan.
   • Explore government support schemes for SMEs if applicable.

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Medical Analogy Summary

Performance Tune Pro Ltd currently suffers from "financial distress syndrome," characterized by a "weak pulse" of cash and a "negative balance sheet heartbeat." The company is in an early "growth phase," but its financial "vital signs" show urgent symptoms needing corrective treatment to prevent "financial collapse." Early interventions to strengthen liquidity and reduce debt burden are crucial to achieving a "healthy financial recovery."

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