Company Number: 12899407

Analysis Date: 2025-07-29 12:09 UTC

Financial Health Assessment for TEES GLOBAL LTD as of 30 September 2024

---

1. Financial Health Score: D

Explanation:
TEES GLOBAL LTD currently exhibits signs of financial distress, reflected in its large negative net assets and working capital deficit. The company’s balance sheet shows a significant erosion of shareholder equity and an inability to cover short-term liabilities with current assets, indicating liquidity challenges. While not yet insolvent, these symptoms suggest urgent attention is needed to restore financial health.

---

2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Net Assets	-50,015	Negative net assets indicate liabilities exceed assets—a critical condition.
Net Current Assets (Working Capital)	-52,585	Current liabilities significantly exceed current assets; a "cash flow blockage" symptom.
Cash at Bank	30,943	Positive but insufficient compared to short-term debts.
Current Liabilities	88,122	High short-term obligations put pressure on liquidity.
Fixed Assets	2,570	Small asset base; limited collateral value.
Average Number of Employees	4	Small workforce consistent with a micro/small enterprise.
Shareholders' Funds	-50,015	Negative equity signals accumulated losses or capital erosion.

---

3. Diagnosis: Financial Symptoms and Underlying Health

• Liquidity Crisis: The company faces a serious liquidity symptom—current liabilities almost triple current assets, meaning it struggles to meet short-term obligations. This "breathing difficulty" in cash flow is a red flag for potential operational disruption.

• Capital Erosion: Negative shareholders’ funds reflect accumulated losses or capital withdrawals exceeding retained earnings. The "immune system" of the company—the equity buffer—is severely weakened, reducing financial resilience.

• Declining Asset Base: Fixed assets decreased slightly, and cash reserves dropped significantly compared to the prior year, suggesting the company may have used cash to cover liabilities or operational costs.

• Shrinking Workforce: A reduction in employees (from 5 to 4) might indicate cost-cutting measures in response to financial stress, but could also impact operational capacity.

• No Audit Requirement: As a small company filing abridged unaudited accounts, there is limited external assurance on financial accuracy, so management vigilance is vital.

• Positive Outlook in Previous Year: The 2023 accounts showed positive net assets and working capital, suggesting the decline is fairly recent and possibly reversible with corrective action.

---

4. Prognosis

If current trends persist, the company risks deepening financial distress, potentially leading to insolvency or forced restructuring. However, the presence of cash reserves and a small scale of operations provide some capacity for recovery if timely strategic adjustments are made.

---

5. Recommendations: Prescription for Financial Wellness

• Enhance Cash Flow Management: Prioritize accelerating debtor collections and negotiating extended terms with creditors to ease the liquidity bottleneck. Consider cash flow forecasting as a "vital sign monitor" to anticipate funding gaps.

• Capital Injection or Debt Restructuring: Explore options for additional equity investment or refinancing to shore up negative net assets and reduce financial strain. This acts like an "immune booster" restoring financial strength.

• Cost Rationalization: Review operating expenses and employee structure carefully to align costs with revenue potential without undermining core capabilities.

• Financial Reporting and Controls: Even as a small company, strengthen internal controls and consider voluntary external reviews to improve transparency and stakeholder confidence.

• Strategic Pivot: Evaluate business model and market positioning in light of recent financial trends to identify opportunities for growth or diversification.

• Engage Professional Advice: Early consultation with financial advisors or turnaround specialists can provide tailored strategies to stabilize and grow the business.

---

Summary

TEES GLOBAL LTD is currently experiencing financial distress characterized by significant liquidity challenges and negative equity, akin to a patient with impaired vital signs requiring urgent care. Nonetheless, the company retains some cash reserves and a small operational footprint, which if managed prudently with targeted financial and operational interventions, can stabilize and restore health.