PETCHEM PROCESS CON. LTD

Executive Summary

PETCHEM PROCESS CON. LTD demonstrates a healthy financial condition with growing net assets and positive working capital, indicating solid short-term liquidity and operational stability for a micro-entity. While there are no immediate signs of financial distress, prudent management of liabilities and strengthening cash reserves will enhance resilience and support sustainable growth.

PETCHEM PROCESS CON. LTD - Analysis Report

Company Number: 13791429

Analysis Date: 2025-07-20 16:59 UTC

Financial Health Assessment of PETCHEM PROCESS CON. LTD (as of 31 December 2023)

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1. Financial Health Score: B

Explanation:
The company exhibits a solid foundation with positive net assets and increasing working capital, reflecting a generally healthy financial condition for a micro-entity. However, the relatively small scale and modest asset base, along with limited financial disclosures typical of micro-entities, suggest caution and room for strengthening liquidity and operational resilience.

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2. Key Vital Signs

Metric	2023 (£)	2022 (£)	Interpretation
Current Assets	109,018	71,759	Healthy increase indicating improved liquidity and cash availability
Current Liabilities	66,896	40,856	Increase in short-term obligations but manageable relative to assets
Net Current Assets (Working Capital)	42,122	30,903	Positive and growing – good short-term financial "breathing room"
Net Assets (Equity)	42,124	30,905	Increase reflects retention of earnings or capital injection
Shareholders’ Funds	42,124	30,905	Fully aligned with net assets, indicating no hidden liabilities
Number of Employees	2	2	Small workforce consistent with micro-entity scale

Interpretation of Vital Signs:

• Working capital is healthy and growing, signaling the company can cover its short-term debts comfortably – a "healthy pulse" in cash flow terms.
• Net assets have increased by about 36%, indicating business growth or reinvestment of profits.
• The rise in current liabilities warrants monitoring but remains well-covered by current assets.

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3. Diagnosis: Financial Condition Overview

PETCHEM PROCESS CON. LTD presents the "symptoms of a stable and growing micro-entity." Its balance sheet shows no signs of distress such as negative equity or liquidity crunches. The positive net current assets indicate the company is not struggling to meet its short-term obligations, a critical "vital sign" of financial health.

The increase in both current assets and liabilities is typical of a growing business, possibly reflecting higher operational activity or investment in working capital. The company maintains a very lean operation with only two employees, consistent with the micro-entity status.

Ownership concentration is very high, with Dr. Samir Al Jalal controlling 75-100% of shares and voting rights, which simplifies decision-making but also concentrates risk.

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4. Recommendations: Actions to Enhance Financial Wellness

• Strengthen Cash Reserves: Although working capital is positive, maintaining a buffer of cash or liquid assets can improve resilience against unexpected expenses or downturns.
• Monitor Current Liabilities Growth: The increase in short-term liabilities should be managed carefully to avoid liquidity stress. Consider negotiating longer payment terms or reducing short-term debt if possible.
• Profit Retention and Reinvestment: Continue retaining earnings to build equity and support future growth initiatives.
• Formalize Financial Planning: Develop a simple but effective budgeting and forecasting process to anticipate cash flow needs and investment opportunities.
• Consider Diversification of Control: To mitigate concentration risk, consider involving additional stakeholders or advisors to provide broader perspectives and governance.
• Maintain Compliance and Timely Filings: Continue to meet filing deadlines to avoid penalties and maintain good standing with regulatory bodies.

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