SWIFT AND SWIFT LIMITED

Executive Summary

SWIFT AND SWIFT LIMITED exhibits strong financial health with positive net assets, healthy working capital, and increasing retained earnings, indicating operational profitability and stability. However, the company should focus on improving cash flow management and reducing reliance on director loans to strengthen liquidity and reduce financial risk. Overall, the company is in good condition with a positive outlook if current trends continue and recommended improvements are implemented.

SWIFT AND SWIFT LIMITED - Analysis Report

Company Number: 13557423

Analysis Date: 2025-07-19 12:52 UTC

Financial Health Assessment: SWIFT AND SWIFT LIMITED (As of 31 August 2024)

---

1. Financial Health Score: B+

Explanation:
SWIFT AND SWIFT LIMITED shows solid financial footing with positive net assets and working capital, growing retained earnings, and manageable liabilities. The company demonstrates healthy cash flow and profitability, although certain indicators suggest areas for cautious monitoring—particularly the significant director’s loan account and moderate liquidity. Overall, the company is in good shape but should remain vigilant to sustain its financial wellness.

---

2. Key Vital Signs:

Metric	2024 Figure	Interpretation
Net Assets	£289,342	Positive net assets indicate the company has more assets than liabilities, a sign of stability.
Net Current Assets (Working Capital)	£124,205	Healthy working capital shows the company can meet short-term obligations comfortably.
Cash at Bank	£77,198	Adequate cash reserves contribute to liquidity but decreased from prior year, warranting monitoring.
Debtors (Trade Receivables)	£328,253	Large debtor balance reflecting good sales but potential risk if collection slows—monitor aging.
Current Liabilities	£293,853	Current liabilities are well-covered by current assets, indicating no immediate liquidity distress.
Directors’ Loan Account	£184,863 (non-current liability)	Significant loan from directors shows reliance on internal funding; stable but should be managed carefully.
Retained Earnings	£287,814 (up from £214,204)	Growing profits retained in the business indicate operational profitability and reinvestment.
Share Capital	£101	Minimal share capital typical for small private companies; equity mainly built from earnings.
Amortisation of Goodwill	£50,000 (annual charge)	Regular amortisation expense reflects investment in acquired goodwill spreading cost over time.

---

3. Diagnosis: Financial Condition Analysis

SWIFT AND SWIFT LIMITED’s financial "vital signs" reveal a business with a generally healthy balance sheet and improving profitability.

• Working Capital is strong, showing the company can cover its short-term debts with liquid assets and receivables — this is akin to a patient with a steady pulse and good hydration.
• The net assets growth (+~£74k from previous year) indicates the company is “building muscle,” retaining earnings rather than distributing all profits.
• Cash reserves, while sufficient, have decreased compared to the prior year, signaling a need to watch cash flow closely to avoid “dehydration” that might impede operational flexibility.
• Trade debtors are sizeable, suggesting the company has strong sales or contracts but faces exposure to credit risk if customers delay payments — this is a symptom that requires monitoring akin to watching for signs of infection.
• The significant director loan account represents internal financing support, which can be a sign of confidence from owners but also a potential vulnerability if external financing is limited; this is comparable to a patient relying on a steady but internal source of nutrients.
• The company is exempt from audit, which is common for small companies but means less external scrutiny — internal controls must be robust to avoid undetected issues.
• The business operates in packaging activities, a sector that can be sensitive to supply chain and raw material cost fluctuations — external factors could influence prognosis.

Overall, the company is financially stable, profitable, and solvent, with no immediate “symptoms of distress,” but some caution is warranted around liquidity management and debtor control.

---

4. Recommendations: Path to Improved Financial Wellness

• Improve Cash Flow Management:
  Strengthen collection procedures to reduce debtor days and increase cash liquidity, preventing potential cash shortages. Consider offering early payment incentives or stricter credit terms.

• Manage Director Loan Account:
  Develop a clear plan to reduce reliance on director loans, possibly by converting part to equity or arranging external financing to diversify funding sources and reduce financial risk.

• Monitor and Control Costs:
  Regularly review amortisation schedules and intangible asset valuations to ensure goodwill remains justified and impairment risks are mitigated.

• Enhance Financial Reporting:
  Although exempt from audit, consider voluntary internal or external financial reviews to ensure accuracy and build stakeholder confidence.

• Plan for Growth or Contingencies:
  Build cash reserves and retain earnings prudently to weather industry volatility or invest in growth opportunities, ensuring the company remains resilient.

• Governance and Compliance:
  Ensure timely filing of accounts and confirmation statements continues, maintaining good standing and avoiding penalties.

---