ROLL PLAY GAMES LTD

Executive Summary

Roll Play Games Ltd is currently facing financial challenges marked by negative working capital and shareholders' funds, indicating liquidity and solvency stress. To avoid escalating distress, the company must improve cash flow, reduce immediate liabilities, and consider financial restructuring. Prompt action could restore financial health and support sustainable operations in the competitive online retail market.

ROLL PLAY GAMES LTD - Analysis Report

Company Number: 13121763

Analysis Date: 2025-07-20 11:56 UTC

Financial Health Assessment for ROLL PLAY GAMES LTD (as of 31 January 2024)

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1. Financial Health Score: D

Explanation:
The company is currently experiencing financial distress characterized by persistent net current liabilities and negative shareholders' funds over the last four years. While it remains an active business, the balance sheet shows symptoms of liquidity strain and erosion of equity, indicating a weak financial condition requiring prompt attention.

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2. Key Vital Signs

Metric	2024 Value	Interpretation
Current Assets	£8,624	Low short-term assets, primarily stock.
Cash at Bank	£419	Very low cash reserves, signaling tight liquidity.
Debtors	£100	Minimal receivables, indicating limited credit sales.
Current Liabilities	£10,951	High short-term debts compared to assets.
Net Current Assets (Working Capital)	-£2,327	Negative working capital — a "symptom of distress" indicating potential cash flow problems.
Total Assets Less Current Liabilities	-£2,327	Negative net assets showing financial weakness.
Shareholders' Funds (Equity)	-£2,427	Negative equity, indicating accumulated losses and potential solvency concerns.
Trend over past 4 years	Persistent negative net current assets and equity	Indicates chronic financial strain without improvement.

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3. Diagnosis

The financial "vital signs" of Roll Play Games Ltd reveal several concerning symptoms:

• Liquidity Deficiency: The company’s working capital is negative (£-2,327 in 2024), meaning current liabilities exceed current assets. This is akin to a patient having low blood volume—there is not enough liquid resources (cash and near cash assets) to meet short-term obligations.

• Cash Flow Weakness: Cash at bank has dropped substantially from £2,718 in 2023 to just £419 in 2024. This "healthy cash flow" indicator is deteriorating, increasing the risk of struggling to pay suppliers or creditors on time.

• Eroded Equity: Shareholders’ funds are in negative territory at £-2,427, showing the company has accumulated losses greater than its capital investment. This situation is like a patient with a chronic disease left untreated—the underlying condition has worsened over time.

• No Employees: The absence of employees suggests the company may be operating at minimal capacity or outsourcing operations, which could impact scalability and revenue generation.

• Industry Context: Operating in internet retail of games (SIC 47910), the sector typically requires agility and sufficient capital to maintain inventory and marketing efforts. The negative working capital and cash crunch are critical red flags.

Overall, these symptoms suggest that Roll Play Games Ltd is in a financially unstable condition, with liquidity risks and solvency concerns that could threaten its continued operation if not addressed.

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4. Recommendations

To improve the financial health and stabilize the business, the following actions are recommended:

1. Improve Cash Reserves:

   • Prioritize generating cash inflows, potentially through sales promotions or accelerating receivables collections.
   • Explore short-term financing options such as overdrafts or invoice financing to bolster liquidity.

2. Reduce Current Liabilities:

   • Negotiate longer payment terms with suppliers to ease immediate cash outflows.
   • Consider restructuring any short-term debts into longer-term obligations to reduce pressure on working capital.

3. Inventory Management:

   • Review stock levels carefully to avoid overstocking which ties up cash. Sell slow-moving inventory aggressively to convert stock into cash.

4. Financial Restructuring:

   • Explore capital injection from shareholders or external investors to restore positive equity and fund growth initiatives.

5. Cost Control:

   • Assess overhead and operational costs to identify savings opportunities, especially given the absence of employees, to ensure the business runs lean.

6. Regular Monitoring:

   • Implement monthly cash flow forecasting and financial health checks to detect early warning signs and manage finances proactively.

7. Strategic Business Review:

   • Revisit business model and marketing strategies to drive revenue growth in the competitive online retail space.

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Medical Analogy Summary:

Roll Play Games Ltd’s financial condition resembles a patient with chronic circulatory issues—there is insufficient "blood flow" (cash) to meet the body's short-term needs, and the "body's reserves" (equity) are depleted. Without timely intervention to boost liquidity and reduce liabilities, the risk of "organ failure" (insolvency) increases. Immediate treatment involving liquidity support and structural financial improvements is essential for recovery.

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