TUKE ELECTRICAL LTD

Executive Summary

TUKE ELECTRICAL LTD maintains a generally sound and stable financial position with positive net assets and working capital, indicating good short-term liquidity and solvency. However, declines in asset values and equity suggest cautious monitoring is necessary to avoid potential contraction. Implementing stronger asset and liquidity management, alongside strategic growth planning, will enhance financial resilience and promote sustainable business health.

TUKE ELECTRICAL LTD - Analysis Report

Company Number: 14362881

Analysis Date: 2025-07-29 17:01 UTC

Financial Health Assessment for TUKE ELECTRICAL LTD

---

1. Financial Health Score: B

Explanation:
TUKE ELECTRICAL LTD demonstrates a generally sound financial position with positive net assets and working capital, indicating a financially stable micro-entity. However, a noticeable decline in fixed assets and current assets from the previous year signals caution. The absence of employees and limited asset base suggest a lean operation, typical of a newly incorporated micro company, but also warrant monitoring for growth and sustainability.

---

2. Key Vital Signs

Metric	2024 Value (£)	2023 Value (£)	Interpretation
Fixed Assets	4,625	6,938	Decline of ~33% suggests disposal or depreciation of equipment, reducing long-term asset base.
Current Assets	24,968	38,740	Significant decrease (~36%) may indicate lower cash or receivables, hinting at reduced liquidity.
Current Liabilities	10,456	21,426	Reduction (~51%) in short-term debts improves liquidity and short-term solvency.
Net Current Assets (Working Capital)	14,512	17,314	Positive and healthy, but decreasing trend suggests slightly tightening operating liquidity.
Net Assets (Equity)	19,137	24,252	Positive equity indicating solvency, but decreasing equity signals possible retained losses or asset write-downs.
Average Number of Employees	0	0	No employees recorded, implying sole trader or subcontracted workforce, limiting operational scale.

Interpretation of Vital Signs:
The company maintains a "healthy cash flow" position with positive working capital and net assets, which reflects sufficient short-term resources to cover liabilities. However, the decline in assets and equity points to "symptoms of distress" or a possible contraction phase. The lack of employees may limit growth potential but keeps overhead low, akin to a patient with minimal metabolic demands.

---

3. Diagnosis: Financial Condition Assessment

TUKE ELECTRICAL LTD is in stable financial health typical of a micro-business within its first two years of operation. The positive net assets and working capital indicate the company is "financially fit" with no immediate signs of distress or insolvency risk. The reduction in both fixed and current assets suggests the company may be scaling back or optimizing operations, which requires further attention to ensure it does not signal declining business activity.

The absence of employees and relatively modest asset base reflects a lean start-up or owner-operated business model. The director’s dual control and substantial shareholding (25-50%) by two individuals indicate concentrated ownership, which can facilitate faster decision-making but also concentrates risk.

---

4. Recommendations: Actions to Improve Financial Wellness

• Enhance Asset Utilization: Review the reasons behind asset reduction and ensure fixed assets are adequate to support current and future operations. Avoid excessive disposal of productive assets which may hinder growth.
• Improve Liquidity Management: Monitor cash flows closely to prevent further erosion of current assets. Maintain strong debtor collection policies and manage credit terms carefully.
• Consider Workforce Strategy: Although no employees are currently recorded, evaluate if hiring or subcontracting additional skilled workers could expand capacity and revenue potential sustainably.
• Build Equity Resilience: Retain earnings where possible to rebuild shareholders’ funds and strengthen financial buffers against unexpected downturns.
• Regular Financial Reviews: Implement quarterly financial health checks to detect early symptoms of distress and react proactively.
• Strategic Planning: Develop a clear growth plan to move beyond micro-entity status, including market development and capital investment considerations.

---