Company Number: 13022445

Analysis Date: 2025-07-20 17:48 UTC

Financial Health Assessment Report: TF1 GYM LIMITED

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1. Financial Health Score: D

Explanation:
TF1 GYM LIMITED shows persistent negative net assets and working capital deficits over the past four reported years. Although the company is operational with current filings up to date, the financial indicators suggest significant distress that requires urgent attention. A grade D reflects serious concerns about liquidity and solvency but not yet at a critical failure stage.

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2. Key Vital Signs

Metric	2024 Value (£)	Interpretation
Turnover	£40,982 (2023)	Very low revenue, indicating limited sales or market reach.
Fixed Assets	£183,099	Substantial investment in long-term assets (likely gym equipment/facilities).
Current Assets	£3,134	Very low liquid/short-term assets available.
Current Liabilities	£187,256	Very high short-term debts due within one year.
Net Current Assets	-£184,122	Severe working capital deficiency ("cash flow symptoms of distress").
Net Assets (Equity)	-£1,023	Negative shareholder equity signals insolvency risks.
Average Employees	2	Small workforce consistent with micro-entity status.
Share Capital	£1.00	Minimal capital invested by shareholders.

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3. Diagnosis

TF1 GYM LIMITED presents several "symptoms" of financial distress:

• Negative Working Capital: The gap between current liabilities and current assets is vast and negative, indicating the company does not have sufficient short-term resources to cover its immediate debts. This is akin to a patient with poor blood circulation—funds are not flowing adequately to meet obligations.

• Negative Net Assets: Shareholders’ funds remain negative, reflecting accumulated losses or liabilities exceeding assets. This condition is a red flag for potential insolvency if unaddressed.

• Low Revenue: With turnover under £41k in the last reported year, the business struggles to generate sales sufficient to sustain operations and service debts.

• High Fixed Assets: A significant portion of the company's value lies in fixed assets, likely gym equipment or property leases. While these are valuable, they are less liquid and may not be easily converted to cash in emergencies.

• Consistent Financial Position: The company’s financial position appears stagnant over four years, with minimal improvement in liabilities or net worth. This suggests the underlying business model may not be producing the cash flow needed to resolve financial strain.

• Small Scale Operation: Operating as a micro entity with only two employees and nominal share capital limits financial flexibility and access to external funding.

Overall, TF1 GYM LIMITED is showing chronic "illness" in its financial health, with symptoms indicating liquidity issues, weak capital structure, and operational constraints.

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4. Recommendations

1. Improve Cash Flow Management:

   • Conduct a detailed cash flow forecast to identify timing of inflows and outflows.
   • Prioritize collection of receivables and manage payables to avoid liquidity crunches.

2. Restructure Short-Term Debt:

   • Negotiate with creditors to extend payment terms or convert some liabilities into longer-term debt.
   • Explore options for refinancing or consolidating debts to reduce immediate pressure.

3. Increase Revenue:

   • Assess marketing and sales strategies to boost membership or service uptake.
   • Consider diversification of revenue streams (e.g., classes, personal training, merchandise).

4. Asset Utilization Review:

   • Evaluate whether fixed assets are fully utilized or if some can be sold or leased to improve liquidity.
   • Avoid further capital expenditure until the financial position stabilizes.

5. Capital Injection or Funding:

   • Consider bringing in additional shareholder capital or external investors to shore up equity.
   • Explore grants or government support schemes available for fitness businesses.

6. Cost Control:

   • Review operating expenses rigorously to identify savings opportunities without impacting service quality.

7. Professional Financial Advice:

   • Engage with a financial advisor or insolvency practitioner early to explore turnaround strategies before distress worsens.

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