THE CHELSEA CLINIC KENSINGTON LTD

Executive Summary

The Chelsea Clinic Kensington Ltd has experienced a significant decline in financial health over the past year, with net assets collapsing from £61,791 to £822, indicating severe financial distress. Immediate action is required to improve liquidity, control costs, and rebuild equity to avoid potential insolvency. Without intervention, the company’s financial prognosis remains poor.

THE CHELSEA CLINIC KENSINGTON LTD - Analysis Report

Company Number: 14251212

Analysis Date: 2025-07-29 20:20 UTC

Financial Health Assessment of THE CHELSEA CLINIC KENSINGTON LTD

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1. Financial Health Score: D

Explanation:
The company shows signs of financial distress in its most recent year (2023-24), with a dramatic decline in net assets from £61,791 to just £822. This sharp deterioration signals serious underlying issues affecting the company’s financial stability. While the previous years indicated a relatively healthy position, the latest figures suggest symptoms of acute financial stress.

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2. Key Vital Signs

Metric	2023 (£)	2024 (£)	Interpretation
Current Assets	102,069	26,409	Significant drop, potentially indicating depletion of cash or receivables—a symptom of shrinking liquidity.
Current Liabilities	39,233	26,083	Decreased liabilities but not proportionally to assets, indicating less buffer.
Net Current Assets	62,836	2,326	Drastic reduction, indicating very tight working capital and a risk of inability to cover short-term obligations.
Net Assets (Equity)	61,791	822	Near collapse of shareholder equity, a critical red flag showing erosion of company value.
Share Capital	101	101	Remains constant, showing no recent equity injection.
Average Employees	1	1	Small headcount, consistent with micro-entity status, but limited human resource capacity.

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3. Diagnosis

Symptoms Analysis:

• The company’s vital signs reveal a severe liquidity crunch and erosion of net worth within a single financial year.
• The collapse from £61,791 to £822 in net assets suggests operating losses or asset write-downs that have severely impaired the company’s financial health.
• Current assets have fallen significantly, which may indicate poor cash flow management, reduced sales, or delayed receivables collection.
• The working capital has almost vanished, posing risks to meeting immediate liabilities, which is a symptom of financial distress.
• The company remains a micro-entity with minimal staff and share capital, limiting its ability to absorb shocks or invest in growth.
• No audit was required, which is typical for micro-entities but means less external scrutiny of accounts.

Overall Condition:
The financial "vital signs" indicate the company is in a fragile state, akin to a patient with dangerously low blood pressure and weakened immune response. Without intervention, this poses a risk of insolvency or inability to sustain operations.

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4. Recommendations

• Immediate Cash Flow Management:
  Tighten control over receivables and payables to stabilize cash flow. Consider short-term financing options to shore up working capital and avoid liquidity crises.

• Cost Rationalization:
  Review all expenses and reduce overheads where possible to prevent further erosion of equity. Given the single employee, focus on operational efficiency.

• Capital Injection:
  Explore options for additional equity funding or shareholder loans to rebuild net assets and provide a buffer against future losses.

• Strategic Review:
  Assess the business model and revenue streams for sustainability. Investigate causes of financial decline—whether market conditions, operational inefficiencies, or other factors—and implement corrective strategies.

• Professional Advisory:
  Engage financial advisors or insolvency practitioners early to explore restructuring options and prevent escalation into formal insolvency proceedings.

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