SAINT GEORGE'S ENTERPRISES LTD

Executive Summary

Saint George's Enterprises Ltd exhibits financial strain characterized by negative working capital and high long-term liabilities relative to equity, placing it at moderate risk. While fixed asset growth indicates investment in real estate operations, liquidity challenges require urgent management focus. Improving cash flow, restructuring debt, and enhancing equity are critical steps to restore financial health and ensure sustainable operations.

SAINT GEORGE'S ENTERPRISES LTD - Analysis Report

Company Number: 12723717

Analysis Date: 2025-07-29 17:11 UTC

Financial Health Assessment of SAINT GEORGE'S ENTERPRISES LTD

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1. Financial Health Score: C (Moderate Concern)

Explanation:
The company shows signs of financial strain with negative working capital and significant long-term liabilities compared to its net assets. However, it maintains positive net assets and continues as an active entity, suggesting some resilience. The score reflects caution due to liquidity risks and reliance on debt.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Fixed Assets	224,289	Investment in long-term assets—significant for a micro company.
Current Assets	4,432	Very low short-term liquid assets; concerning for day-to-day operations.
Current Liabilities	13,818	Short-term obligations; exceeds current assets, causing negative working capital.
Net Current Assets (Working Capital)	-9,386	Negative working capital indicates potential cash flow difficulties.
Creditors due after one year	169,050	Large long-term liabilities, increasing financial risk.
Net Assets (Shareholders' Funds)	44,053	Positive equity but reduced from previous year (56,078).
Share Capital	1	Minimal share capital, typical for small private companies.

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3. Diagnosis

• Liquidity Symptoms (Negative Working Capital):
  The company’s current liabilities exceed current assets by £9,386, signaling a lack of sufficient liquid resources to cover immediate debts. This is akin to a patient with a low pulse rate—warning of potential distress in meeting short-term obligations.

• Leverage and Financial Structure:
  The presence of £169,050 in long-term creditors against £44,053 in net assets indicates a high leverage ratio. This "debt burden" resembles excess cholesterol in the bloodstream, which can clog financial arteries and restrict healthy growth.

• Asset Base and Investment:
  Fixed assets have grown significantly from zero to £224,289 over the last year, suggesting capital investment or property acquisition consistent with the company's real estate letting activity. This could be a positive sign if generating income but may strain cash flow if financed by debt.

• Profit and Loss Insight:
  The accounts do not include a profit and loss statement, but the reduction in net assets from £56,078 to £44,053 hints at possible losses or distributions exceeding profits. This is comparable to a patient losing weight unexpectedly, signaling underlying health issues.

• Director Loans and Related Party Transactions:
  The director has made advances and repayments with a small interest charge, indicating some internal support but also potential dependency on director funding.

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4. Recommendations

• Improve Liquidity Management:
  Focus on increasing current assets, especially cash or receivables, to restore positive working capital. This may involve accelerating collections, delaying non-essential payments, or injecting short-term funds.

• Debt Restructuring:
  Engage with creditors to renegotiate terms of long-term liabilities. Spreading out payments or converting some debt to equity could relieve financial pressure and improve solvency.

• Monitor Cash Flow Closely:
  Given the negative working capital, implement tight cash flow forecasting and control to avoid liquidity crises.

• Assess Asset Utilization:
  Review the fixed assets acquired to ensure they are generating expected rental income or returns. Idle or underperforming assets should be reconsidered or disposed of.

• Explore Additional Capital Injection:
  Consider increasing share capital or attracting new investors to strengthen equity and reduce reliance on debt.

• Maintain Compliance and Transparency:
  Continue timely filing of accounts and confirmation statements to avoid penalties and maintain stakeholder confidence.

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