STEVE ALLON BUILDING & HOMES LTD

Executive Summary

STEVE ALLON BUILDING & HOMES LTD shows a healthy financial start with positive net assets and working capital for its first year of operation. While the company currently maintains a stable financial position with manageable liabilities, its small scale and modest asset base suggest a need to build stronger cash reserves and control working capital tightly. With prudent financial management and strategic planning, the company is well positioned to grow sustainably in the building and finishing sector.

STEVE ALLON BUILDING & HOMES LTD - Analysis Report

Company Number: 14722063

Analysis Date: 2025-07-20 12:15 UTC

Financial Health Assessment for STEVE ALLON BUILDING & HOMES LTD

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1. Financial Health Score: B

Explanation:
The company demonstrates a solid foundation for a micro-entity in its first year, with positive net assets and working capital. The balance sheet shows healthy equity and manageable short-term liabilities. However, as a newly incorporated business with limited financial history and modest asset and current asset levels, there is room for improvement in liquidity and cash management to ensure resilience against future operational stresses.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Fixed Assets	12,887	Reflects investment in long-term resources, indicating some operational capacity.
Current Assets	3,664	Short-term assets including cash and receivables; relatively low but positive.
Current Liabilities	1,372	Short-term debts; manageable given current assets.
Net Current Assets (Working Capital)	2,292	Positive working capital indicates the company can cover short-term obligations comfortably.
Accruals and Deferred Income	1,056	Some accrued expenses or income deferred; typical for a startup phase.
Net Assets (Shareholders’ Funds)	14,123	Positive equity base, indicating the company is solvent at this stage.
Number of Employees	2	Small team consistent with micro-entity status; limited scale but manageable overhead.

Interpretation of Vital Signs:

• Healthy cash flow potential: Positive net current assets suggest the company is not facing immediate liquidity strain.
• Early-stage asset base: Fixed assets are modest but indicate some investment in operational capacity, suitable for a start-up builder/finisher.
• Low liabilities burden: Current liabilities are low relative to assets, reducing financial distress risk.
• Limited operating scale: Two employees indicate the company is still small and may face scalability challenges.

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3. Diagnosis

The financial "vital signs" reveal a company in the early stages of development with generally good financial health for a micro-entity. The positive net assets and working capital suggest no immediate symptoms of financial distress such as cash flow shortages or overreliance on debt.

However, the low levels of current assets and fixed assets reflect limited operational scale and capitalisation. This means the company may be vulnerable to unexpected expenses or downturns without sufficient financial buffer. The absence of any audit requirements and the use of micro-entity accounting provisions also mean less detailed financial scrutiny, which could mask early warning signs.

Given the company’s age (incorporated March 2023) and industry (building completion and finishing), it is typical to see modest asset bases and cautious financial posture initially. The director’s full ownership and control suggest decision-making is centralized, which can be positive for swift responses but also concentrates risk.

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4. Recommendations

To enhance financial wellness and ensure sustainable growth, the company should consider:

• Strengthen Cash Reserves: Aim to increase current assets, especially cash or equivalents, to build a buffer for operational volatility common in construction-related activities.
• Monitor Working Capital Closely: Maintain positive working capital by managing receivables and payables efficiently to avoid liquidity crunches.
• Plan for Asset Investment: Consider phased investments in fixed assets to improve operational capacity without overextending finances.
• Establish Robust Financial Controls: Even as a micro-entity, adopt basic financial monitoring and forecasting to detect early signs of distress.
• Explore Growth Financing: If growth is intended, investigate potential financing routes (e.g., small business loans or grants) to support expansion beyond the current micro scale.
• Review Business Risks: Evaluate operational and market risks regularly, especially given the construction sector’s sensitivity to economic cycles.
• Maintain Compliance: Continue timely filing of accounts and confirmation statements to avoid penalties and maintain credibility.

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