SAM LOGIK LTD

Executive Summary

SAM LOGIK LTD remains solvent with positive net assets and working capital but has experienced significant declines in liquidity and equity over the past year, signaling emerging financial stress. Immediate focus on cash flow management, cost control, and profitability improvement is crucial to stabilize and strengthen the company’s financial health going forward.

SAM LOGIK LTD - Analysis Report

Company Number: 14305584

Analysis Date: 2025-07-29 20:18 UTC

Financial Health Assessment for SAM LOGIK LTD

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1. Financial Health Score: C

Explanation:
SAM LOGIK LTD exhibits some signs of financial resilience but also shows notable weaknesses. The company has positive net assets and working capital, which are "vital signs" of solvency and liquidity. However, a sharp decline in net current assets and total net assets from the previous year signals potential "symptoms of distress" that warrant careful monitoring and remedial action.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Fixed Assets	766	957	Slight decrease; immaterial for micro entity
Current Assets	2,476	4,074	Significant drop, mainly in debtors
Current Liabilities	1,934	774	Substantial increase; a warning sign
Net Current Assets	542	3,299	Sharp decline; working capital remains positive but thin
Total Assets Less Current Liabilities	1,308	4,256	Drastic fall in net assets; reduced financial cushion
Net Assets / Shareholders’ Funds	1,308	4,256	Significant erosion of equity, indicating stress
Average Number of Employees	1	0	Growth in staff; adds operational expense

• Liquidity: Net current assets remain positive, indicating the company can cover short-term liabilities, but the margin has reduced drastically from £3,299 to £542. This thinning "cash flow pulse" could restrict operational flexibility.
• Solvency: Net assets have decreased by ~69%, suggesting the company’s buffer against liabilities has deteriorated.
• Operational Efficiency: The company increased liabilities sharply with relatively fewer assets to match. This imbalance may indicate either increased borrowing or delayed payments—both potential "symptoms" of financial strain.
• Asset Base: Fixed assets are minimal and fairly stable, typical for a micro entity in the "Unlicensed carrier" industry, so not a major concern.
• Staffing: Addition of one employee indicates some business activity growth, but also higher fixed costs.

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3. Diagnosis

SAM LOGIK LTD’s financial condition can be likened to a patient who has a healthy baseline but has experienced a recent setback. The company is solvent and liquid but is showing symptoms of financial stress:

• The sharp reduction in current assets (mainly debtors) coupled with increased current liabilities suggests cash is not being collected or managed efficiently, causing tightening liquidity.
• The erosion of net assets and shareholders’ funds indicates the company has likely incurred losses or distributed profits, depleting the equity cushion.
• The business is still operationally viable but vulnerable to shocks due to its reduced financial buffer.
• The micro-entity filing and exemption from audit mean less financial transparency, which could obscure underlying risks.
• The increase in employee count suggests an attempt at growth, but without corresponding asset or equity growth, this could increase financial strain.

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4. Recommendations

To restore and improve financial wellness, the company should consider the following steps:

• Improve Cash Collection: Accelerate debtor collections to improve cash flow. Consider stricter credit control policies or incentives for early payment.
• Manage Liabilities: Review and renegotiate payment terms with suppliers and creditors to reduce short-term cash demands.
• Cost Control: Monitor and contain operating expenses, especially related to new employee costs, to prevent further erosion of equity.
• Profitability Focus: Develop strategies to increase revenue and margins; operating losses or insufficient profits appear to have weakened net assets.
• Financial Monitoring: Implement monthly cash flow forecasts and financial KPIs to detect early signs of distress.
• Stakeholder Communication: Maintain clear and timely communication with shareholders and lenders about the company’s financial position and recovery plans.
• Seek Professional Advice: Consider consulting a financial advisor or accountant to assist with restructuring and financial planning.

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