TEKARTIS LTD

Executive Summary

TEKARTIS LTD faces significant financial challenges characterized by negative equity and liquidity shortfalls, indicating a fragile financial condition. Immediate remedial actions focusing on liquidity, capital infusion, and operational efficiency are essential to stabilize and improve the company's financial health. Without intervention, the risk of insolvency increases, but recovery is achievable with targeted strategies.

TEKARTIS LTD - Analysis Report

Company Number: 12749020

Analysis Date: 2025-07-29 15:06 UTC

Financial Health Assessment Report for TEKARTIS LTD

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1. Financial Health Score: D (Weak Financial Condition)

Explanation:
TEKARTIS LTD's financial indicators reveal a troubling downturn in financial health over recent years. The company has moved from a strong net asset position in 2020 (£34,195) to a negative net asset position of -£960 in 2024, indicating financial distress. The negative net current assets and declining fixed assets further underline liquidity and operational challenges, warranting a cautious outlook with significant attention needed.

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2. Key Vital Signs (Core Financial Metrics)

Metric	2024 Value	Interpretation
Fixed Assets	£1	Drastic reduction from £2,068 in 2020; minimal long-term asset base
Current Assets	£720	Very low, reflecting limited cash or receivables
Current Liabilities	£1,395	Exceeds current assets, creating a liquidity squeeze
Net Current Assets	-£675	Negative working capital, symptom of cash flow stress
Total Assets less Current Liabilities	-£674	Negative, showing liabilities surpass assets
Net Assets (Shareholders Funds)	-£960	Negative equity indicates insolvency risk
Average Employees	1	Small micro-entity with very limited human resources
Share Capital	£1	Minimal capital invested, limiting financial buffer

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3. Symptoms Analysis (What the Numbers Reveal)

• Liquidity distress: Negative net current assets (-£675) signify the company does not have enough short-term assets to cover its immediate obligations. This is akin to a patient showing signs of dehydration—urgent replenishment needed to sustain operations.
• Erosion of equity: The fall from £34,195 in net assets in 2020 to -£960 in 2024 indicates accumulated losses or write-downs. This resembles a gradual weakening of the immune system, making the business vulnerable to external shocks.
• Asset depletion: Fixed assets decreased sharply from £2,068 to £1, suggesting asset disposals or impairments, likely to cover liabilities or generate cash.
• Operational scale: With only one employee and micro-entity status, the business has very limited capacity to generate revenues or absorb shocks.
• No audit exemption reliance: Micro-entity accounts prepared under simplified rules may limit detailed financial insights but still clearly show deteriorating fundamentals.

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4. Diagnosis (Overall Financial Condition)

TEKARTIS LTD is experiencing financial distress, with symptoms pointing toward liquidity problems and a solvency challenge. The negative net assets and working capital deficits suggest the company is operating with strained resources. This condition is serious, indicating the business may struggle to meet its short-term commitments without additional capital infusion or operational restructuring.

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5. Prognosis (Future Financial Outlook)

If current trends persist without corrective intervention, the company risks insolvency or forced restructuring. The outlook is precarious—akin to a patient with untreated symptoms worsening over time. However, with prompt strategic actions such as capital injection, cost control, and revenue growth initiatives, recovery remains possible.

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6. Recommendations (Improving Financial Wellness)

• Immediate liquidity management: Prioritize cash flow forecasting and aggressively manage payables and receivables to avoid default on liabilities.
• Capital reinforcement: Consider bringing in new equity or loans to restore positive net assets and provide an operational buffer.
• Cost rationalization: Review expenses critically, especially fixed costs, to preserve cash and improve net current assets.
• Asset management: Evaluate fixed assets for potential sale or better utilization to raise funds or reduce liabilities.
• Business model review: With SIC codes indicating consultancy and IT services, explore diversifying clients or enhancing service offerings to boost revenues.
• Financial monitoring: Implement regular financial health reviews to detect early warning signs and act swiftly.
• Professional advice: Engage with financial advisors or turnaround specialists for tailored recovery plans.

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