SMYRNA TECHNOLOGY LIMITED

Executive Summary

Smyrna Technology Limited shows a stable financial position with positive net assets and working capital, indicating good solvency and liquidity fundamentals for a micro-sized business. However, the absence of cash reserves and reliance on debtors highlight the need for better cash flow management to avoid liquidity strain. With focused improvements in receivables collection and cash buffer building, the company can strengthen its financial health and support sustainable growth.

SMYRNA TECHNOLOGY LIMITED - Analysis Report

Company Number: 13133272

Analysis Date: 2025-07-29 19:24 UTC

Financial Health Assessment: Smyrna Technology Limited

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1. Financial Health Score: B

Explanation:
Smyrna Technology Limited demonstrates a modest but positive financial position with growing net assets and working capital. The company is relatively young (incorporated 2021) and maintains positive net current assets, which suggests a stable liquidity position. However, overall asset size and equity remain low, reflecting its micro-sized scale and limited capital base, which constrains resilience against financial shocks. The absence of cash at the latest year-end is a mild concern, though not critical given the company's small scale and positive debtor balances.

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2. Key Vital Signs:

Metric	2024 Value	Interpretation
Net Current Assets	£471	Positive net working capital indicates the company can cover short-term liabilities—a healthy cash flow symptom.
Net Assets (Equity)	£471	Small but positive net worth indicates the company is solvent but has limited financial buffer.
Current Assets	£5,241	Composed entirely of debtors; no cash on hand as of 2024 year-end, indicating potential cash flow timing issues.
Current Liabilities	£4,770	Near parity with current assets, implying tight liquidity but manageable obligations.
Share Capital	£100	Minimal equity investment reflects the company's micro status and early development phase.
Profit & Loss Reserves	£371	Accumulated retained earnings growing over time, showing some profitability or capital contribution.
Debtors	£5,241	High debtor balance relative to cash suggests revenue is tied up in receivables—potential risk if collection is delayed.
Cash at Bank	£0	Lack of immediate cash "on hand" may limit the ability to meet urgent cash needs.
Employee Count	1	Very small operational scale, likely owner-managed, limiting operational leverage.

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3. Diagnosis:

• Liquidity & Working Capital:
  The company exhibits a "stable pulse" with positive net current assets (£471), meaning it can meet short-term liabilities from current assets. However, the 2024 accounts show 0 cash at bank, with all current assets in debtors. This suggests a symptom of "cash flow congestion"—the business may face timing mismatches in converting sales into usable cash. This is common in small companies relying on credit sales or invoicing delays.

• Solvency & Equity:
  Net assets have increased from £241 in 2021 to £471 in 2024, showing gradual equity growth and suggesting that the company is solvent and not over-leveraged. Equity consists mainly of retained earnings rather than new share capital, indicating some operational profitability or at least positive net results retained in the business.

• Growth & Scale:
  The company remains micro-sized with very modest capital and employee count. This scale limits financial resilience but also means lower operational complexity and overheads.

• Operational Efficiency:
  The company operates in IT consultancy and online retail activities, with turnover and profit figures not disclosed in abridged accounts. The reliance on debtors as current assets points to a need for efficient receivables management to maintain a healthy cash flow.

• Risk Factors:

  • Dependence on one director and PSC increases governance risk.
  • No cash reserves could be a "risk symptom" if unexpected expenses arise.
  • The company is exempt from audit, which may limit external oversight.

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4. Recommendations:

1. Improve Cash Flow Management:

   • Implement stricter debtor credit controls and accelerate collection processes to convert receivables into cash more quickly.
   • Consider negotiating better payment terms with customers or offering early payment incentives.

2. Build Cash Reserves:

   • Aim to maintain a minimum cash buffer to handle short-term obligations smoothly and avoid liquidity squeeze.
   • Explore short-term financing options if necessary to cover timing gaps.

3. Enhance Financial Reporting:

   • Even though exempt from audit, consider a voluntary financial review or internal controls strengthening to increase transparency and early risk detection.

4. Plan for Growth:

   • As the sole employee, consider developing scalable operational processes or outsourcing non-core tasks to free capacity for business development.

5. Maintain Compliance:

   • Ensure timely filing of accounts and confirmation statements to avoid penalties and maintain good standing.

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