THE NJ NETWORK GROUP LIMITED

Executive Summary

THE NJ NETWORK GROUP LIMITED shows persistent negative equity and severe liquidity issues, indicating financial distress despite compliance with filing obligations. Immediate actions to improve working capital and control costs are essential to avoid further deterioration. With focused financial management and capital support, the company can stabilize and improve its outlook.

THE NJ NETWORK GROUP LIMITED - Analysis Report

Company Number: SC685358

Analysis Date: 2025-07-29 16:09 UTC

Financial Health Assessment of THE NJ NETWORK GROUP LIMITED

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1. Financial Health Score: D

Explanation:
The company shows persistent negative net assets and net current liabilities over the past four years, indicating ongoing financial distress. While it remains active and compliant with filings, the balance sheet reveals symptoms of financial strain that require urgent attention to avoid further deterioration.

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2. Key Vital Signs

Metric	Latest (2024)	Interpretation
Fixed Assets	£604	Very low fixed asset base, indicating minimal investment in long-term resources.
Current Assets	£6	Extremely low liquid assets; almost no cash or receivables to cover short-term obligations.
Current Liabilities	£2,467	Short-term debts significantly exceed current assets, indicating liquidity issues.
Net Current Assets	-£2,461	Working capital is deeply negative, a key symptom of cash flow strain.
Total Assets Less Current Liabilities	-£1,857	Total asset value after paying off short-term creditors is negative, showing balance sheet weakness.
Shareholders’ Funds	-£1,857	Negative equity means liabilities surpass assets, indicating insolvency on a balance sheet basis.
Share Capital	£1.00	Minimal capital injection; company relies on other funding or accrual of losses.

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3. Diagnosis

• Symptoms of Distress:
  The company exhibits signs akin to a patient with chronic illness: persistent negative equity and a lack of liquid assets to cover immediate debts point to ongoing financial difficulties. The negative working capital (-£2,461) is particularly concerning, as it suggests the company is unable to meet short-term liabilities from current assets, a classic symptom of liquidity stress. This could lead to operational disruptions if creditors demand payment.

• Underlying Issues:

  • The business operates with minimal fixed and current assets, indicating limited operational scale or recent start-up phase struggles.
  • Negative retained earnings (reflected in negative shareholders' funds) suggest accumulated losses since incorporation.
  • The company’s micro-accounting status means less detailed disclosure, but the available data clearly reveal a fragile financial position.

• Management and Control:
  The sole director and controlling shareholder, Miss Beth Caroline Jowett, holds full control, which can be a positive for swift decision-making but may also mean limited external oversight on financial strategy.

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4. Recommendations

• Improve Liquidity:

  • Inject additional working capital, either through shareholder loans or equity, to address negative net current assets.
  • Accelerate receivables collection and manage payables terms to improve cash flow.
  • Consider short-term financing options carefully to avoid escalating liabilities.

• Cost and Expense Control:

  • Conduct a rigorous review of operating costs to identify areas for reduction.
  • Focus on generating positive cash flows from core advertising agency activities.

• Financial Monitoring:

  • Implement regular cash flow forecasting and financial health checks to detect worsening symptoms early.
  • Engage an independent financial advisor or accountant to provide oversight and strategic input.

• Growth and Asset Base:

  • Evaluate opportunities for asset acquisition or investment that can improve operational capacity and long-term stability.
  • Explore potential partnerships or client contracts to increase turnover.

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Medical Analogy Summary

THE NJ NETWORK GROUP LIMITED currently presents with symptoms analogous to a patient experiencing chronic financial stress: negative equity (akin to a weakened immune system), liquidity shortage (dehydration symptoms), and insufficient capital reserves (nutritional deficiency). Without targeted intervention, the prognosis is guarded, with risks of insolvency increasing. Early and decisive corrective action is vital to restore financial health and operational vitality.

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