TRAVIATA CONSULTING LTD

Executive Summary

TRAVIATA CONSULTING LTD is currently facing significant financial challenges, with key indicators showing negative net assets and working capital deficits, signaling liquidity and solvency issues. Immediate actions focusing on cash flow management, creditor negotiations, and capital strengthening are critical to reversing this downward trend and restoring financial health. With timely interventions, the company may stabilize and improve its financial outlook.

TRAVIATA CONSULTING LTD - Analysis Report

Company Number: SC656910

Analysis Date: 2025-07-29 12:08 UTC

Financial Health Assessment: TRAVIATA CONSULTING LTD

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1. Financial Health Score: D

Explanation:
The company’s financial health appears to be under significant stress as reflected by the recent financial year (2024) showing negative net current assets and negative net assets (total liabilities exceed assets). This is a red flag akin to a patient exhibiting symptoms of severe distress in vital signs. Although the company was solvent with positive net assets in prior years (2020-2023), the sharp deterioration signals urgent attention is needed to restore financial stability.

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2. Key Vital Signs (Critical Metrics & Interpretation)

Metric	2024 Value (£)	Interpretation
Fixed Assets	0	Complete write-off or disposal of long-term assets – asset base depleted.
Current Assets	13,404	Very low liquidity compared to previous years; cash or receivables likely depleted.
Current Liabilities	34,456	Short-term debts remain significant relative to assets.
Net Current Assets (Working Capital)	-21,052	Negative working capital; company cannot cover short-term debts with short-term assets – symptom of cash flow distress.
Net Assets (Shareholders’ Funds)	-21,052	Company is technically insolvent; liabilities exceed total assets – a critical warning sign.
Share Capital	1	Minimal share capital; limited equity buffer.
Average Employees	1	Very small operation, likely limited revenue generation capacity.

Trend Analysis:

• From 2020 to 2023, net assets were positive and fluctuated between £17,906 and £49,031.
• In 2024, net assets plummeted to negative £21,052, indicating a severe financial deterioration over one year.
• Fixed assets dropped from £14,513 in 2023 to zero in 2024, suggesting asset disposals or write-downs.
• Current assets also decreased dramatically from £234,294 to £13,404 in 2024.
• Current liabilities reduced but not proportionally enough to prevent a deficit.

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3. Diagnosis: Financial Condition Assessment

TRAVIATA CONSULTING LTD is exhibiting symptoms of financial distress:

• Negative working capital means the company lacks the "healthy cash flow" needed for day-to-day operations, signaling liquidity problems.
• Negative net assets indicate insolvency on a balance sheet level, which is a serious condition that can lead to creditor actions or insolvency procedures if not corrected.
• The sharp decline in fixed and current assets suggests possible asset sales or write-downs, which might be a response to cash flow pressures or operational losses.
• The company operates on a micro scale with minimal employees and share capital, limiting its ability to absorb shocks or raise new equity.
• No indication of overdue filings or administrative issues, so compliance "vital signs" are currently stable.

Overall, the company is in a critical but potentially reversible condition if swift and effective financial interventions occur. Without action, the prognosis leans toward worsening insolvency risk.

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4. Recommendations: Specific Actions to Improve Financial Wellness

To restore financial health, the company should consider the following steps, akin to a treatment plan addressing the root causes of illness:

1. Urgent Cash Flow Management:

   • Conduct a detailed cash flow forecast to identify timing gaps.
   • Prioritize collection of receivables and delay non-essential expenditures.

2. Debt Restructuring:

   • Negotiate with creditors to restructure or extend payment terms to alleviate immediate pressure on current liabilities.

3. Capital Injection:

   • Consider raising additional equity or shareholder loans to boost net assets and provide working capital.

4. Asset Review:

   • Evaluate the necessity of fixed assets and whether any additional disposals or acquisitions might improve liquidity or operational efficiency.

5. Operational Efficiency:

   • Review business model and cost structure given the micro scale; explore ways to increase revenue streams or reduce overhead.

6. Professional Advice:

   • Engage an insolvency practitioner or financial advisor for tailored restructuring advice to avoid liquidation or administration risks.

7. Monitor Vital Signs Regularly:

   • Maintain close monitoring of financial KPIs monthly/quarterly to detect early symptoms of distress.

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