STRATHSPEY PROPERTY LIMITED

Executive Summary

Strathspey Property Limited currently demonstrates financial distress characterized by negative net assets and working capital deficits. The company owns significant property assets but faces liquidity challenges and high debt levels. Prompt action to improve cash flow and strengthen equity is essential to restore financial health and ensure sustainable operation.

STRATHSPEY PROPERTY LIMITED - Analysis Report

Company Number: SC744536

Analysis Date: 2025-07-29 18:26 UTC

Financial Health Assessment for STRATHSPEY PROPERTY LIMITED

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1. Financial Health Score: D

Explanation:
The company is exhibiting signs of financial stress, primarily due to net liabilities and negative shareholders’ funds. While it owns significant fixed assets related to property, these are heavily leveraged by long-term creditors. The negative net current assets and overall net liabilities indicate a fragile financial position, warranting a cautious outlook.

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2. Key Vital Signs

Metric	2024 Value	Interpretation
Fixed Assets	£658,365	Healthy level for a property company; likely represents owned real estate.
Current Assets	£15,802	Low liquid assets; minimal cash or receivables to cover short-term obligations.
Current Liabilities	£45,535	Short-term debts exceed current assets, causing negative working capital.
Net Current Assets (Working Capital)	-£29,733	Symptom of liquidity strain; insufficient short-term resources to meet immediate debts.
Long-Term Liabilities	£660,000	Large debt burden against assets; potentially mortgage or loan secured on property.
Net Assets / Shareholders Funds	-£31,368	Negative equity; company owes more than it owns, indicating financial distress.
Profitability	Not explicitly reported	No profit/loss data available; no retained earnings; likely no profit generation yet.
Employees	Nil	No employees, suggesting minimal operational costs but also limited ability to generate revenue.

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3. Diagnosis: Financial Condition

• Asset Base: The company holds substantial fixed assets (£658k), consistent with its industry focus on real estate ownership and operation. This is a positive "organ" of the company, indicating a tangible asset backing.

• Liquidity Symptoms: The company shows a negative working capital (-£29,733), a critical symptom suggesting it struggles to cover short-term obligations with readily available resources. This "poor pulse" in liquidity could lead to operational challenges if creditors demand payments.

• Leverage and Solvency: A long-term liability of £660,000 against £628,632 total assets less current liabilities results in a net liability position of -£31,368. This is analogous to a patient whose debts outweigh assets — a sign of financial distress or insolvency risk.

• Equity Position: Negative shareholders’ funds confirm that the company’s financial "heart" is weak. This means owners’ claims are currently underwater, which could limit borrowing capacity and investor confidence.

• Operational Picture: The company has no employees and limited current assets, suggesting limited cash flow generation capacity. This could imply dependence on external financing or capital injections to sustain operations.

• Trends: The net liabilities increased from -£14k in 2023 to -£31k in 2024, indicating worsening financial health over the year.

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4. Recommendations: Steps to Improve Financial Wellness

1. Improve Liquidity:

   • Increase cash reserves by accelerating receivables collection or injecting cash capital.
   • Negotiate better payment terms with creditors to reduce short-term liabilities pressure.

2. Debt Restructuring:

   • Review long-term debt terms with lenders; consider refinancing to improve repayment schedules or reduce interest burden.

3. Enhance Equity:

   • Consider capital injections from shareholders or new investors to restore positive net assets and strengthen the financial "immune system."

4. Operational Activity:

   • Explore ways to generate operational income, e.g., leasing property or enhancing asset utilization, to build cash flow.

5. Financial Monitoring:

   • Implement regular financial reviews focusing on cash flow forecasting and working capital management to detect early distress signs.

6. Professional Advice:

   • Consult with financial advisors or insolvency practitioners proactively if cash flow issues persist, to avoid forced liquidation.

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Medical Analogy Summary

The company’s financial "vitals" show a weak pulse, with negative working capital and net liabilities indicating symptoms of distress. The "heart" — equity capital — is in deficit, signaling potential failure if no intervention occurs. Immediate action to improve liquidity and restructure debt could stabilize the "patient," enabling recovery and long-term health.

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