SOLWAY SUPPORT LTD

Executive Summary

SOLWAY SUPPORT LTD is currently in a financially fragile state with minimal revenue and ongoing losses leading to negative equity. The company exhibits symptoms of liquidity strain and insufficient operational activity, requiring urgent strategic and financial action to restore health. Immediate focus on increasing turnover, controlling costs, and managing liabilities is essential to improve the company's outlook.

SOLWAY SUPPORT LTD - Analysis Report

Company Number: SC739012

Analysis Date: 2025-07-29 20:41 UTC

Financial Health Assessment for SOLWAY SUPPORT LTD (Period Ending 31 July 2024)

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1. Financial Health Score: D

Explanation:
SOLWAY SUPPORT LTD currently exhibits symptoms of financial distress characterized by persistent negative net assets and ongoing losses with minimal revenue generation. While the company remains active, the financial "vital signs" suggest a fragile state with a weakened cash flow and balance sheet. The score "D" indicates the company is struggling and requires urgent attention to restore financial health.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Turnover (Revenue)	102	Extremely low, indicating minimal sales activity.
Profit/Loss for Period	-2,721	Operating at a loss, though smaller than prior year.
Current Assets	5,003	Includes cash and receivables, a positive sign.
Current Liabilities	8,827	Short-term debts exceed current assets – liquidity risk.
Net Current Assets	-3,824	Negative working capital; company may struggle to meet short-term obligations.
Net Assets (Shareholders’ Funds)	-3,823	Negative equity reflects accumulated losses.
Staff Costs	5 (minimal)	Near zero, consistent with no employees reported.
Cost of Materials	-5	Negligible, indicating minimal production or service delivery.

Additional Notes:

• The company has no fixed assets, limiting collateral or investment base.
• Losses have decreased compared to the prior year’s £9,803 loss but remain negative.
• No employees declared, suggesting either outsourcing, inactivity, or a dormant operational model without staff.
• Directors hold full control; no external shareholders diluting governance.

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3. Diagnosis

SOLWAY SUPPORT LTD presents as a company in its early stages or undergoing a severe operational slowdown. The extremely low turnover (£102) compared to the previous year's £22,454 signals a sharp drop in business activity or revenue generation. The recurring losses have eroded shareholder equity, resulting in negative net assets. This is akin to a patient whose vital signs (financial metrics) show weakness: a weak pulse (low revenue), poor oxygenation (negative net assets), and signs of malnutrition (low cash reserves).

The negative working capital indicates the company is “short of breath” financially, struggling to cover its immediate liabilities with available current assets. Although losses have improved somewhat from the previous year, the company does not generate sufficient income to cover overheads and liabilities, risking insolvency if the trend continues.

The absence of employees suggests a lean or possibly inactive operational model, potentially relying on external contractors or awaiting new business development. The director’s dual role as majority shareholder and operator may be beneficial for swift decision-making but also concentrates risk.

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4. Recommendations

To stabilize and improve financial health, SOLWAY SUPPORT LTD should consider the following remedial steps:

1. Boost Revenue Generation:

   • Reassess the business model and explore new client acquisition strategies.
   • Investigate why turnover dropped drastically and address operational barriers.

2. Manage and Reduce Costs:

   • Tighten control on operating expenses and overheads to minimize losses.
   • Evaluate any unnecessary liabilities or debts; negotiate payment terms with creditors where possible.

3. Improve Liquidity:

   • Consider short-term financing options or director loans to alleviate working capital pressures.
   • Convert any possible assets to cash to enhance liquidity.

4. Financial Monitoring:

   • Implement regular cash flow forecasting to anticipate and manage shortfalls.
   • Maintain transparent and timely accounting records to facilitate management decisions.

5. Explore Strategic Options:

   • If the current business model is unsustainable, consider restructuring, merging, or seeking external investment.
   • Engage professional advice for turnaround strategies or insolvency options if necessary.

6. Governance and Controls:

   • With a single controlling director, ensure robust checks and balances to mitigate operational risks.
   • Review statutory compliance and maintain regular filings to avoid penalties.

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