V R GROUP PROPERTIES LTD

Executive Summary

V R GROUP PROPERTIES LTD is currently experiencing financial distress characterized by negative net assets and poor liquidity, despite substantial fixed assets. The company’s financial health score is D, reflecting insolvency risk and liquidity constraints. Immediate actions such as debt restructuring, capital injection, and improved cash flow management are essential to restore financial stability and ensure long-term viability.

V R GROUP PROPERTIES LTD - Analysis Report

Company Number: 12851667

Analysis Date: 2025-07-20 18:05 UTC

Financial Health Assessment for V R GROUP PROPERTIES LTD

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1. Financial Health Score: D

Explanation:
The financial data reveals significant concerns primarily due to persistent negative net assets and net current liabilities, indicating financial distress symptoms. Although the company has substantial fixed assets, these are heavily offset by long-term creditors, leading to a net liability position. The overall financial condition suggests fragility, warranting close attention and remedial action.

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2. Key Vital Signs

Metric	2024 Value	Interpretation
Fixed Assets	£899,508	Strong investment in long-term assets, likely property-related given the industry SIC codes.
Current Assets	£66	Extremely low liquid assets, indicating poor immediate cash availability — "weak pulse".
Current Liabilities	£947,381	Very high short-term obligations, signaling "symptoms of liquidity stress".
Net Current Assets (Working Capital)	-£1,338	Negative working capital, showing the company does not have enough current assets to cover debts.
Creditors due after one year	£947,381	Large long-term liabilities; significant debt burden impacting solvency.
Net Assets (Equity)	-£49,211	Negative equity indicates insolvency on a balance sheet basis — a serious "underlying condition".
Share Capital	£100	Minimal capital base, limiting financial buffer capacity.
Employee Count	0	No employees, possibly indicating a holding or property management structure without operational staff.

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3. Diagnosis

The company shows clear symptoms of financial distress:

• Negative Net Assets: The company's liabilities exceed its assets by £49,211. This "balance sheet deficit" signals insolvency risk if not addressed.

• Liquidity Constraints: The current assets are negligible compared to current liabilities. This "weak pulse" means the company may struggle to meet immediate financial obligations, threatening operational stability.

• Heavy Debt Load: Large creditors due after one year (long-term debt) of £947,381 impose high fixed charges or repayment obligations, which could strain cash flow.

• Asset Concentration: Almost all assets are fixed (property or similar), which while valuable, are illiquid and cannot easily be converted to cash for day-to-day expenses.

• No Audit & Micro Entity Reporting: Being a micro-entity and exempt from audit limits transparency somewhat but does not negate the evident financial strain.

• Management Stability: Recent director changes with a short tenure may signal governance or strategic uncertainty. However, the main controlling party (Mrs. Sandeep Kaur) holds dominant ownership and director status.

Overall, the company is in a fragile financial state, exhibiting "symptoms" that require prompt intervention to avoid worsening solvency issues.

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4. Recommendations

To improve financial health and "restore vitality," consider the following actions:

1. Improve Liquidity Management

   • Seek short-term financing or inject capital to bolster current assets and improve working capital.
   • Negotiate extended payment terms with creditors or restructure short-term liabilities.

2. Debt Restructuring

   • Engage creditors to restructure or renegotiate long-term debt to manageable levels, reducing financial burden.

3. Asset Utilization

   • Evaluate fixed assets for potential sale or refinancing (e.g., mortgages, asset-backed loans) to unlock cash reserves.
   • Ensure property portfolio is generating income consistent with debt servicing needs.

4. Capital Injection

   • Consider equity funding from current shareholders or new investors to restore positive net asset position.

5. Governance and Strategic Review

   • Stabilize board and management to ensure consistent strategic direction.
   • Develop a clear business plan focusing on profitability and cash flow management.

6. Regular Monitoring

   • Implement monthly financial reviews focusing on cash flow forecasts and creditor payments to detect early distress signals.

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