RYCO PROPERTY GROUP LTD

Executive Summary

Ryco Property Group Ltd’s financial health reveals critical liquidity and solvency challenges, with worsening negative net current assets and shareholders’ funds. Immediate focus on cash flow management, debt restructuring, and capital strengthening is essential to avert further financial deterioration and ensure business continuity.

RYCO PROPERTY GROUP LTD - Analysis Report

Company Number: 13027708

Analysis Date: 2025-07-29 16:27 UTC

Financial Health Assessment of Ryco Property Group Ltd

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1. Financial Health Score: D

Explanation:
Ryco Property Group Ltd currently exhibits signs of financial distress, primarily due to persistent negative net current assets and shareholders' funds over the last three years. The company’s working capital position is in deficit, indicating an inability to cover short-term liabilities with short-term assets. This places the company in a vulnerable financial state, requiring urgent remedial action to restore stability.

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2. Key Vital Signs

Metric	2024 (£)	Interpretation
Current Assets	580	Extremely low liquidity, mostly debtors and minimal cash (only £100).
Current Liabilities	1,440	High short-term obligations, almost 2.5 times current assets.
Net Current Assets	-860	Negative working capital indicates liquidity strain, potential difficulty in meeting short-term debts.
Shareholders' Funds	-960	Negative equity reflects accumulated losses or funding issues, a serious concern for solvency.
Cash in Hand	100	Very limited cash reserves, poor cash flow buffer to meet immediate expenses.
Debtors	480	Some receivables, but may not be liquid or collectible promptly to alleviate cash pressure.

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3. Diagnosis: Financial Symptoms and Underlying Health

• The company shows symptoms of financial distress, primarily evidenced by a negative net current asset position worsening from -£380k in 2023 to -£860k in 2024. This is akin to a patient whose vital signs are deteriorating, signaling poor liquidity health.
• Shareholders’ funds have turned negative, indicating that liabilities exceed assets, a critical warning that the company’s capital base is impaired. This is similar to a loss of foundational strength in the business.
• The cash reserve is critically low at £100, insufficient to cover immediate obligations, meaning the company may struggle to meet urgent payments without external support or improved cash inflows.
• The increase in current liabilities from £480k to £1.44M in one year is alarming and suggests either rapid expansion without matching asset growth or accumulating debts, which may be unsustainable.
• Absence of fixed assets or long-term assets in the reported balance sheet limits options for raising secured finance or asset sales to improve liquidity.
• The company operates in property management and real estate sectors, which can be capital intensive and sensitive to market cycles. The lack of employees suggests minimal operational activity, possibly outsourcing or a holding structure.
• This financial profile resembles a patient with strained vital organs: liquidity and capital structure are compromised, requiring immediate intervention to avoid collapse.

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4. Recommendations: Prescriptions for Financial Wellness

1. Urgent Cash Flow Management:

   • Prioritize collection of outstanding debtors (£480) to boost cash reserves.
   • Negotiate with creditors to extend payment terms or restructure liabilities to reduce immediate pressure.

2. Capital Injection or Debt Restructuring:

   • Seek additional equity funding or shareholder loans to restore positive net assets and improve solvency.
   • Explore refinancing high current liabilities with longer-term debt to ease short-term cash flow.

3. Operational Review:

   • Assess business model for revenue generation and expense control given the minimal asset base and employee count.
   • If the company is a holding or investment vehicle, consider consolidation or divestment of non-core assets.

4. Financial Monitoring:

   • Implement regular and detailed cash flow forecasts and management accounts to monitor liquidity closely.
   • Engage professional advice for restructuring or turnaround planning if financial pressures persist.

5. Compliance and Reporting:

   • Ensure timely filing of accounts and confirmation statements to avoid penalties and maintain corporate reputation.

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Executive Summary

Ryco Property Group Ltd is currently experiencing significant financial strain, with negative working capital and shareholders' funds indicating poor liquidity and solvency. Immediate actions are required to improve cash flow, restructure liabilities, and consider capital injections to restore financial health. Without prompt intervention, the company risks ongoing distress that could impair its operational viability.