UNEXPLORED MEDIA LTD

Executive Summary

UNEXPLORED MEDIA LTD is showing clear symptoms of financial distress with negative net assets and worsening liquidity. Immediate actions to manage cash flow, reduce costs, and strengthen capital are critical to restoring financial health. Without intervention, the risk of insolvency increases.

UNEXPLORED MEDIA LTD - Analysis Report

Company Number: 14562906

Analysis Date: 2025-07-29 18:36 UTC

Financial Health Assessment of UNEXPLORED MEDIA LTD

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1. Financial Health Score: D

Explanation:
The company's financial health shows clear symptoms of distress. The negative net current assets and net liabilities indicate a liquidity crunch and potential solvency issues. While the company is still operational, the financial vital signs suggest challenges that require urgent management intervention.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Current Assets	122	133	Extremely low cash and short-term assets, indicating limited liquidity buffer.
Current Liabilities	1,436	479	Significant increase, showing rising short-term obligations.
Net Current Assets (Working Capital)	-1,314	-346	Negative and worsening, a key symptom of cash flow distress.
Net Assets (Equity)	-1,314	-346	Negative equity signals the company owes more than it owns, a critical red flag.
Shareholders’ Funds	-1,314	-346	Reflects accumulated losses eroding owner’s capital.

Additional Context:

• The company is a micro-entity in the artistic creation sector, with one employee (the director).
• The director, Miss Billie Rhiannon Morland, holds 75-100% ownership and control, centralizing decision-making.
• The company has no audit requirement but must closely monitor its financial condition given the liabilities.

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3. Diagnosis: Financial Condition Overview

The financial snapshot reveals symptoms of severe financial strain:

• Liquidity Stress: The company’s current liabilities exceed current assets by more than £1,300, indicating it may struggle to meet short-term debts as they fall due. This is akin to a patient with dangerously low blood pressure—without immediate support, the risk of collapse increases.
• Negative Equity: The net liabilities position, worsening from -£346 in 2023 to -£1,314 in 2024, shows cumulative losses or undercapitalization. This is equivalent to a chronic condition weakening the company’s financial "immune system."
• Lack of Financial Cushion: With minimal current assets (£122), the company has very limited cash or receivables to buffer unexpected expenses or downturns.
• Growth or Investment Constraints: Given the negative net assets, external financing or investment might be difficult without addressing the underlying issues.

Overall, the company appears to be in a precarious financial state, functioning but with clear distress signals that, if untreated, could lead to insolvency or forced restructuring.

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4. Recommendations: Prescriptions for Financial Wellness

1. Immediate Cash Flow Management:

   • Prioritize improving liquidity by collecting outstanding receivables promptly and negotiating extended payment terms with creditors.
   • Explore short-term financing options such as director loans or overdrafts to stabilize cash flow.

2. Capital Injection:

   • Consider an equity injection from the shareholder to restore positive net assets and strengthen the balance sheet. This is similar to administering a vital transfusion to restore strength.

3. Cost Control and Expense Review:

   • Review all expenses and reduce non-essential costs to preserve cash.
   • If possible, increase revenue streams to improve operating inflows.

4. Financial Monitoring and Forecasting:

   • Implement tight budget controls and prepare cash flow forecasts to anticipate future liquidity needs.
   • Regular financial reviews to detect early symptoms of distress.

5. Seek Professional Advice:

   • Engage with a financial advisor or insolvency practitioner early to explore viable restructuring or turnaround strategies. Early intervention often prevents more serious outcomes.

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