PMD OFFSHORE LTD

Executive Summary

PMD OFFSHORE LTD shows a stable but weakening financial condition marked by reduced liquidity and equity due to increased liabilities and provisions. While the company is not in immediate distress, the sharp decline in working capital is a warning sign requiring careful cash flow management and cost control. Proactive financial oversight and strategic planning are recommended to restore robust financial health.

PMD OFFSHORE LTD - Analysis Report

Company Number: 13800156

Analysis Date: 2025-07-29 17:10 UTC

Financial Health Assessment: PMD OFFSHORE LTD (as of 31 December 2023)

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1. Financial Health Score: C

Explanation:
PMD OFFSHORE LTD demonstrates some positive aspects of financial stability, such as positive net assets and modest but positive working capital. However, the sharp reduction in net current assets and net assets compared to the previous year signals emerging financial strain or investment activity that has affected liquidity. The company is not in immediate distress but exhibits warning signs that warrant monitoring and potential corrective action.

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2. Key Vital Signs

Metric	2023 Value (£)	2022 Value (£)	Interpretation
Fixed Assets	8,083	4,103	Increase indicates investment in long-term resources; healthy growth.
Current Assets	23,018	17,635	Growth in current assets is positive for short-term liquidity.
Current Liabilities	21,870	7,109	Large increase; potential cash flow pressure or increased short-term debt.
Net Current Assets	1,148	10,526	Sharp decline; working capital is positive but severely diminished.
Total Assets Less CL	9,231	14,629	Decrease reflects overall reduction in asset liquidity after liabilities.
Provisions for Liabilities	1,536	0	New provisions may indicate anticipated future expenses/liabilities.
Net Assets (Shareholders’ Funds)	7,695	14,629	Nearly halved; equity base weakened, reducing financial cushion.
Average Number of Employees	1	1	Stable; small-scale operation consistent with micro-entity classification.

Interpretation of Vital Signs:

• The "healthy cash flow" indicated by a positive net current asset position is still present but has diminished substantially, a "symptom of distress" in liquidity management.
• The increase in current liabilities and provisions could signal upcoming financial obligations or operational pressures.
• The equity reduction implies the company may have incurred losses or taken on liabilities impacting retained earnings or capital.

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3. Diagnosis

PMD OFFSHORE LTD is a micro-entity operating with a very small workforce and modest asset base. The company has invested in fixed assets, which is a positive sign of growth or operational capacity enhancement. However, the significant increase in current liabilities and the creation of provisions for liabilities have eroded the company's liquidity and equity position.

This financial "symptom" could indicate the company is experiencing increased operational costs, delayed receivables, or preparing for foreseeable expenses (such as warranties, legal, or restructuring costs). The drop in working capital (net current assets) from £10,526 to £1,148 is particularly concerning for short-term financial resilience.

Overall, the company’s financial "pulse" is weak but stable; it is not critically ill but shows signs of strain that need careful monitoring and management.

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4. Recommendations

• Improve Liquidity Management: Tighten control over accounts payable and receivable to avoid liquidity crunches. Reducing current liabilities or negotiating better payment terms can help restore a healthier working capital balance.
• Review Provisions: Investigate the nature of the new provisions to understand and manage potential future outflows. Planning for these liabilities is crucial to avoid cash flow shocks.
• Cost Control Measures: Evaluate operational expenses to identify areas for cost savings or efficiency improvements, especially given the small scale of the business.
• Capital Injection or Financing: Consider options to bolster shareholders’ funds if ongoing operations strain equity or to fund growth initiatives. This could involve shareholder loans or external financing but should be approached cautiously given current financial signs.
• Regular Financial Monitoring: Implement monthly cash flow forecasting and financial reviews to detect early "symptoms" of financial distress and react promptly.
• Business Strategy Review: Assess the business model and market conditions to ensure the investments in fixed assets align with revenue-generating activities, ensuring a return on asset deployment.

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