STREAM INDUSTRIES LTD.

Executive Summary

STREAM INDUSTRIES LTD. currently exhibits financial distress characterized by negative working capital and shareholders' funds, indicating ongoing losses and liquidity challenges. The company relies heavily on director support to maintain operations, with minimal operational scale and cash reserves. Immediate focus on liquidity improvement, capital restructuring, and sustainable revenue generation is critical for future financial health.

STREAM INDUSTRIES LTD. - Analysis Report

Company Number: 14121309

Analysis Date: 2025-07-29 14:15 UTC

Financial Health Assessment of STREAM INDUSTRIES LTD.

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1. Financial Health Score: D

Explanation:
STREAM INDUSTRIES LTD. exhibits several symptoms of financial distress. The company has persistent negative net current assets and shareholders' funds over the last three years, indicating ongoing working capital deficits and accumulated losses. While the company is still active and not in liquidation, the financial "vital signs" suggest fragility and reliance on external support to maintain operations.

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2. Key Vital Signs

Metric	2024 (Latest)	Interpretation
Cash at Bank	£1,655	Very low cash reserves, indicating limited liquidity — "thin pulse" in cash flow terms.
Current Liabilities	£4,280	Short-term debts exceed cash and other current assets, leading to a working capital deficit.
Net Current Assets	-£2,625	Negative working capital ("symptom of distress") indicating inability to cover short-term obligations.
Total Assets Less Current Liabilities	-£2,625	Negative net assets imply the company owes more than it owns, a "deficit" in financial health.
Shareholders' Funds	-£2,635	Negative equity shows accumulated losses and undercapitalization, a "chronic illness" for financial stability.
Average Number of Employees	0	No staff employed, suggesting minimal operational scale or outsourcing of activities.
Director's Current Account	£3,320 (liability)	Director has provided funds to support the company, showing external reliance akin to an "IV drip".

Additional Notes:

• The company operates in the business support services sector (SIC 82990), with no reported assets besides cash and director's loan.
• The accounts are prepared on a going concern basis, but this is heavily reliant on continued support from the director and creditors.
• No audit required, typical for a small company, but limits external assurance on financial health.

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3. Diagnosis

The company’s financial health shows significant warning signs. Negative net current assets and shareholders' funds indicate the company is "under the weather" financially. This suggests:

• Liquidity Strain: The company lacks sufficient liquid resources to meet immediate obligations without external help. This is akin to a patient whose vital signs are unstable without medical support.
• Capital Deficiency: The accumulated losses reflected in negative equity highlight that the business has been operating at a loss or drawing down capital, weakening its financial immune system.
• Reliance on Director Support: The director’s current account liability suggests funds have been advanced to keep the company afloat, acting like a life support system.
• No Operational Scale: Zero employees and minimal assets indicate a startup or holding structure with limited trading activity or operational capacity.

Given these symptoms, the company is "at risk" but not yet critically ill. The prognosis depends heavily on the director’s continued financial backing and the ability to generate positive cash flows or restructure liabilities.

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4. Recommendations

To improve the financial wellness of STREAM INDUSTRIES LTD., consider the following steps:

• Improve Liquidity: Increase cash reserves through capital injection, improved receivables collection, or renegotiation of payment terms with creditors.
• Address Negative Equity: Consider a formal capital reorganization such as a rights issue or debt-to-equity conversion to strengthen the balance sheet.
• Operational Assessment: Evaluate business model viability and explore ways to generate sustainable revenue to reduce reliance on director loans.
• Cost Management: Since there are no employees, ensure fixed costs are minimized and operational expenses are tightly controlled.
• Regular Financial Monitoring: Institute monthly cash flow forecasting to detect symptoms of distress early and take preemptive action.
• Director Support Plan: Formalize arrangements with the director regarding financial support, possibly through documented loans or equity contributions, to ensure continuity of going concern.
• Seek Professional Advice: Engage with financial advisors or restructuring specialists if losses and liquidity pressures continue, to avoid acute financial crisis.

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