RIVAL SCAFFOLDING LTD

Executive Summary

Rival Scaffolding Ltd exhibits a marked improvement in liquidity and equity, transitioning from a precarious position to a more financially stable state. While the company demonstrates healthy cash flow and positive net assets, monitoring debtor collections and lease obligations will be essential to sustain its financial wellness. Overall, the business is on a sound financial footing with potential for continued growth.

RIVAL SCAFFOLDING LTD - Analysis Report

Company Number: 13102767

Analysis Date: 2025-07-29 13:30 UTC

Financial Health Assessment of Rival Scaffolding Ltd

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1. Financial Health Score: B

Explanation:
Rival Scaffolding Ltd shows a solid improvement in financial health over the last year, moving from net current liabilities to a strong net current asset position. The company maintains positive net assets and shareholders' funds, indicating a stable equity base. However, some caution is warranted due to relatively modest fixed assets and moderately high current liabilities, primarily finance leases, which could be a symptom of operational leverage.

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2. Key Vital Signs

Metric	2023 Value (£)	Interpretation
Current Assets	91,125	Healthy short-term resources including cash and receivables, more than doubled since 2022.
Cash at Bank	45,836	Strong cash balance reflecting good liquidity and ability to cover short-term obligations.
Debtors	45,289	Significant receivables indicating ongoing business, but requires monitoring for collection efficiency.
Current Liabilities	54,678	Increased liabilities, largely due to finance lease obligations, may signal leveraged financing.
Net Current Assets	36,447	Positive working capital, a vital sign of healthy day-to-day operations and buffer against shocks.
Net Assets (Equity)	58,981	Positive and growing equity base indicates retained profits and overall financial resilience.
Fixed Assets (Net Book)	22,534	Tangible assets mostly plant and machinery; moderate investment in long-term operational capacity.
Profit & Loss Reserve	58,979	Accumulated retained earnings reflecting profitability over time.
Share Capital	100	Minimal share capital indicating a small company structure.
Average Number of Employees	3	Small workforce consistent with micro/small company scale.

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3. Diagnosis: Financial Condition and Underlying Health

"Vital Signs" Analysis:
The company has transitioned from a state akin to a patient with "symptoms of distress" in 2021-2022 — negative net current assets and modest cash — to a much healthier state by 2023. The net current assets turning positive (£36,447) and cash position quadrupling to £45,836 demonstrate improved liquidity and operational cash flow management, akin to restoring healthy blood circulation in a patient.

"Symptoms" Revealed:

• The significant increase in finance lease obligations (£24,255) suggests the company has taken on debt-like commitments to finance equipment or vehicles. This is a common scenario in capital-intensive trades like scaffolding but requires careful monitoring to avoid over-leverage.
• Debtor balances have nearly doubled, which while a sign of increased business, pose a risk if collection slows — akin to a mild fever signaling inflammation.
• The net assets growth from £21,878 to £58,981 shows the company is retaining earnings and building equity, indicating profitability and prudent management.

Operational Insights:
The company employs 3 staff, consistent with a small, focused operation. The turnover and profit data are not provided, but the retained earnings suggest ongoing profitability. The directors appear engaged and have maintained compliance without overdue filings.

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4. Recommendations: Enhancing Financial Wellness

1. Strengthen Debtor Management:
   Implement tighter credit control procedures to ensure timely collection of debts and prevent cash flow bottlenecks. This is critical to maintain "healthy cash flow" and avoid liquidity stress.

2. Monitor Lease Obligations and Leverage:
   Regularly review finance lease commitments to ensure they remain sustainable relative to cash generation. Consider refinancing or paying down leases to reduce fixed financial obligations.

3. Build Cash Reserves:
   Maintain or grow the cash buffer to protect against unexpected downturns or delayed payments. This acts like maintaining a "healthy immune system" against financial shocks.

4. Invest in Asset Efficiency:
   Evaluate whether fixed assets (plant and machinery) are optimally utilized. Upgrading or maintaining assets can improve operational efficiency, boosting profitability and financial resilience.

5. Continue Compliance and Reporting:
   Maintain timely filing of accounts and confirmation statements to preserve good standing and avoid penalties which could strain resources.

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