Company Number: 13547807

Analysis Date: 2025-07-29 19:15 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Red Physiotherapy Ltd is an active, micro-entity private limited company operating in the physical well-being and general medical practice sector. While the company shows positive net assets growth from £2,922 in 2023 to £29,669 in 2024, net current liabilities in 2024 indicate a working capital deficit (-£12,472), which is a concern for short-term liquidity and debt servicing ability. However, the increase in fixed assets and overall net assets suggests capital investment and growth. Conditional approval is recommended, contingent on monitoring cash flow management and receivables collection closely.

2. Financial Strength:
   The balance sheet shows total net assets improving substantially year-on-year (£12,554 in 2022 to £29,669 in 2024), reflecting retained earnings and capital injection or asset revaluation. Fixed assets nearly doubled from £20,160 to £42,141, indicating investment in long-term resources. However, current liabilities rose sharply to £39,402 in 2024, exceeding current assets of £26,930, resulting in negative net current assets. This indicates potential liquidity strain despite overall positive equity.

3. Cash Flow Assessment:
   The negative net working capital in 2024 suggests the company may face challenges meeting short-term obligations without relying on external funding or improved cash management. The limited cash balance reported in 2023 (£1,970) and absence of recent cash data in 2024 prevents a full liquidity analysis but flag the need for close monitoring of operating cash flow, debtor collections, and creditor payments. The business employs only 2 staff, which limits fixed overheads, possibly easing cash flow pressure.

4. Monitoring Points:

• Track monthly cash flow and liquidity ratios to ensure current liabilities can be met timely.
• Monitor debtor days and creditor payment terms to identify any deterioration in working capital management.
• Observe any changes in fixed asset capitalization to confirm productive investment use.
• Review management’s plans for addressing the working capital deficit and improving cash reserves.
• Watch for timely filing of future accounts and confirmation statements to maintain compliance.