TOTAL COMMS & UTILITIES LTD

Executive Summary

TOTAL COMMS & UTILITIES LTD shows signs of financial stability but faces challenges with declining net assets and tightening liquidity. While currently solvent, the company exhibits early symptoms of financial strain that warrant proactive management of cash flow and debt. Strengthening operational efficiency and maintaining regulatory compliance will be key to improving its financial health.

TOTAL COMMS & UTILITIES LTD - Analysis Report

Company Number: 13034742

Analysis Date: 2025-07-20 13:00 UTC

Financial Health Assessment for TOTAL COMMS & UTILITIES LTD

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1. Financial Health Score: C

• Explanation:
  The company shows modest net asset value and positive working capital, but recent declines in net assets and increased long-term liabilities indicate some financial strain. As a micro-entity, it maintains compliance and modest operational scale, but the financial indicators suggest cautious monitoring and improvement are necessary.

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2. Key Vital Signs

Metric	2023 Value (£)	Trend vs. 2022	Interpretation
Fixed Assets	27,760	Slight decrease (-4%)	Stable long-term asset base, minor depreciation or disposal
Current Assets	122,433	Decrease (-5.5%)	Slight decline in liquidity resources
Current Liabilities	120,287	Decrease (-4.5%)	Slight reduction in short-term obligations
Net Current Assets (Working Capital)	2,146	Decrease (-39%)	Marginal positive buffer; reduced liquidity cushion
Creditors Due After 1 Year	6,088	New liability	Introduction of medium/long-term debt adds financial risk
Net Assets (Equity)	22,968	Decrease (-27.5%)	Shrinking shareholder value signaling profitability pressures
Share Capital	2	No change	Minimal equity base typical for micro-entity
Average Employees	2	Stable	Very small workforce, low overhead

• Vital Signs Interpretation:
  The company maintains a "heartbeat" in the form of positive working capital, but it is weakening. The introduction of long-term creditors is a symptom of financial strain or investment needs. The shrinking net assets point to accumulated losses or asset write-downs. Cash flow appears tight, requiring vigilance.

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3. Diagnosis

• Liquidity:
  The positive but low net current assets suggest the company can just cover its short-term debts, but with a diminished cushion compared to previous years—a symptom of tightening liquidity.

• Solvency:
  Net assets remain positive, so the company is solvent. However, a near 30% drop in net assets within one year and the appearance of medium-term liabilities may indicate early signs of financial distress or restructuring for growth.

• Profitability:
  No direct profit & loss data is provided, but balance sheet trends (declining equity) imply reduced retained earnings or possible losses.

• Operational Scale:
  Micro-entity status with only 2 employees and minimal share capital suggests a lean operation, possibly with limited revenue streams or narrow margins.

• Governance and Compliance:
  On time with filings, no overdue returns or accounts, indicating good regulatory compliance and management governance.

• Overall Diagnosis:
  The company is currently functioning but under financial "stress symptoms," such as weakening liquidity and shrinking equity. The introduction of long-term creditors may be an attempt to manage cash flow or invest, but it elevates risk.

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4. Recommendations

• Strengthen Liquidity:
  Enhance cash flow management to build a stronger working capital buffer. Consider negotiating better payment terms with suppliers or accelerating receivables.

• Review Debt Strategy:
  Evaluate the terms and necessity of long-term liabilities. Excessive debt can strain the "heart" of the business. Explore refinancing or equity injection options to reduce financial burden.

• Profitability Focus:
  Conduct a detailed profitability review. Identify cost-saving initiatives and revenue growth opportunities to reverse the decline in net assets.

• Asset Management:
  Monitor fixed assets for impairment or underutilization. Consider whether asset sales or more efficient use of resources can improve financial health.

• Maintain Compliance:
  Continue timely filings and good governance practices to avoid legal or regulatory "infections" that can exacerbate financial problems.

• Strategic Planning:
  Engage in scenario planning to prepare for market fluctuations or unexpected expenses, ensuring the business remains resilient and adaptable.

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