SWAN SITE ENGINEERING (NE) LTD

Executive Summary

Swan Site Engineering (NE) Ltd demonstrates a sound financial position with positive net assets and working capital typical of a young micro-entity. However, a sharp increase in short-term liabilities signals potential liquidity stress that requires careful cash flow management. With timely action on working capital and operational planning, the company is well-placed for stable growth.

SWAN SITE ENGINEERING (NE) LTD - Analysis Report

Company Number: 14194746

Analysis Date: 2025-07-29 16:50 UTC

1. Financial Health Score: B

Explanation: Swan Site Engineering (NE) Ltd shows a solid financial foundation typical for a micro-entity in its early years. The company maintains positive net assets and working capital across three years, indicating generally healthy finances. However, the increase in current liabilities in 2024 relative to the prior year signals emerging liquidity pressure that warrants attention. The absence of debt beyond one year and no provisions for liabilities is positive. The single-employee structure suggests a lean operation but also a potential vulnerability if business conditions change.

2. Key Vital Signs:

• Net Assets: £19,926 (2024), up from £15,619 (2022) — healthy equity base with steady growth.
• Net Current Assets (Working Capital): £10,406 (2024), down from £16,521 (2023) — still positive but reduced liquidity buffer.
• Current Liabilities: £15,867 (2024), sharply increased from £1,000 (2023) — potential symptom of short-term cash flow strain.
• Fixed Assets: £9,520 (2024), increased from £6,400 (2023) — investment in long-term assets reflects business growth or capital expenditures.
• Employee count: 1 (consistent) — lean operation, limited human resource flexibility.

Interpretation: The company retains a healthy capital structure with positive net assets and working capital, which are vital signs of financial health. However, the sudden jump in short-term liabilities is a symptom that may indicate delayed payments or increased short-term borrowing, which could strain cash flow if not managed.

3. Diagnosis:

Swan Site Engineering (NE) Ltd is financially stable with a strong equity base for a micro-entity and steady asset growth. The company’s positive net current assets suggest it can cover short-term obligations, but the rapid rise in current liabilities is an early symptom of potential liquidity stress. This could reflect increased supplier credit, delayed receivables, or accrual of expenses. The business appears well-capitalized but must monitor cash flow closely to avoid becoming overstretched. The single employee setup indicates limited operational scale, which could impact resilience during market fluctuations.

4. Recommendations:

• Cash Flow Monitoring: Implement rigorous tracking of receivables and payables to ensure liquidity remains healthy. Consider cash flow forecasting to anticipate and mitigate any short-term cash crunches.
• Manage Current Liabilities: Investigate reasons for increased current liabilities and seek to negotiate better payment terms or reduce short-term debts to improve working capital.
• Capital Expenditure Review: Ensure that fixed asset purchases are aligned with business growth and generate sufficient returns.
• Growth and Staffing Strategy: Assess whether scaling up staffing or outsourcing could improve operational capacity and reduce single-person dependency risks.
• Maintain Compliance: Continue timely filing of accounts and confirmation statements to avoid penalties and maintain good standing.

Using a medical analogy, the company’s "heart" (net assets) is strong, and its "blood flow" (working capital) is adequate but showing signs of "stress" (rising liabilities). Proactive management can restore full vitality and support healthy growth.