PHF SERVICES LIMITED
Company number 04886252 · Monitor this company
This analysis was written by an AI from the company's public filings. It may contain errors or omissions and is not financial or professional advice.
Credit Analysis: PHF Services Limited
1. Credit Opinion: DECLINE
Reasoning: This company is technically insolvent and has been for at least a decade. Net liabilities stand at £731,849 with deeply negative shareholders' funds of -£1,596,140. While there was a marginal improvement in 2024, the fundamental balance sheet position is critically weak. The going concern basis relies entirely on continued director/shareholder support — an unacceptable foundation for new credit exposure. Cash reserves have deteriorated by 66% year-on-year, and working capital is severely negative. The business is surviving on creditor forbearance rather than operational self-sufficiency.
2. Financial Strength
Balance Sheet Position: Critically Weak
| Metric | 2024 | 2023 | Movement |
|---|---|---|---|
| Net Assets | (£731,849) | (£815,098) | +£83,249 improvement |
| Shareholders' Funds | (£1,596,140) | (£1,679,389) | +£83,249 improvement |
| Net Current Liabilities | (£583,133) | (£603,761) | +£20,628 improvement |
| Tangible Fixed Assets | £520 | £675 | Marginal |
Key Concerns:
- Persistent Insolvency: The company has carried negative net assets for the entire 10-year review period. Retained losses of -£1.6m have consumed share capital (£11,837) and share premium (£852,454), leaving a substantial deficit.
- Minimal Asset Base: Tangible fixed assets of just £520 are essentially fully depreciated. The business has virtually no asset collateral.
- Creditor Dependency: Total creditors of £1.017m fund the vast majority of the balance sheet. Other creditors (likely director/related party loans) comprise £828k of current liabilities — the company is overwhelmingly financed by related parties rather than operating profits.
- Funding Circle Loan: £138,144 with personal guarantees from directors and a shareholder (Mr John Webb). This represents a committed third-party obligation with personal recourse.
Positive Note: The £83k improvement in net liabilities suggests the company generated a modest profit in 2024, breaking the pattern of accumulated losses.
3. Cash Flow Assessment
Liquidity Position: Severely Strained
| Metric | 2024 | 2023 | Movement |
|---|---|---|---|
| Cash | £70,545 | £206,119 | -£135,574 (-66%) |
| Trade Debtors | £126,056 | £116,838 | +£9,218 |
| Other Debtors | £88,294 | £68,220 | +£20,074 |
| Current Ratio | 0.33x | 0.39x | Deteriorated |
Critical Findings:
- Cash Collapse: Cash has fallen from £206k to £70k — a 66% decline. This is the most alarming metric in this filing. With £868k in current liabilities, the company has less than 1 month's creditor coverage in cash terms.
- Working Capital Deficit: £583k negative working capital means the company cannot cover short-term obligations from current assets. Trade creditors and other creditors are effectively funding operations.
- Debtor Growth: Trade and other debtors increased by £29k combined, suggesting either revenue growth or slower collection. Without a P&L, it's unclear whether this reflects trading momentum or payment delays.
- Creditor Reduction: Current creditors fell from £995k to £868k (-£127k), and non-current creditors from £212k to £149k (-£63k). This suggests either debt repayment or write-offs rather than operational improvement.
- Bank Borrowings: Minimal at £29.9k total (£5.5k current + £24.4k non-current), suggesting the company has limited access to formal credit facilities.
4. Monitoring Points
If any credit exposure is considered (e.g., under existing arrangements or with significant security), the following require close monitoring:
| Priority | Metric | Current Position | Threshold for Concern |
|---|---|---|---|
| Critical | Cash Position | £70,545 | Falling below £30k |
| Critical | Director/Shareholder Support | Ongoing (stated) | Any withdrawal or reduction |
| Critical | Going Concern Status | Dependent on director assurances | Qualification or emphasis in audit |
| High | Current Ratio | 0.33x | Below 0.25x |
| High | Net Liabilities Trajectory | Improving (£83k reduction) | Reversal to increasing deficits |
| High | Funding Circle Loan Performance | £138k with personal guarantee | Default or arrears |
| Medium | Employee Count | 38 (down from 40) | Significant further reductions |
| Medium | Trade Creditor Days | £18.6k outstanding | Significant increases suggesting cash stress |
| Medium | Related Party Creditor Movements | £828k other creditors | Rapid reduction may indicate withdrawal of support |
Additional Risk Factors: - The company changed its name from "Personal Health Finance Limited" in 2005 — consider whether legacy obligations exist under the previous name. - Accounts are filed under the small companies regime with no audit, limiting financial transparency. - The income statement is not delivered, making profitability assessment difficult beyond the movement in retained earnings.