VERGOLUS LTD

Executive Summary

Vergolus Ltd is a newly incorporated micro-entity showing stable short-term liquidity but limited equity and a significant long-term debt burden. The company’s financial health is currently stable yet fragile, typical of early-stage businesses. Strengthening equity, managing liabilities, and focusing on revenue growth are key to improving its financial resilience and future outlook.

VERGOLUS LTD - Analysis Report

Company Number: 15222334

Analysis Date: 2025-07-29 18:57 UTC

Financial Health Assessment for VERGOLUS LTD

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1. Financial Health Score: C

Explanation:
Vergolus Ltd has a modest but positive financial position for a micro-entity in its first year. It shows a small positive net asset base (£794), indicating some initial equity cushion. However, the company carries longer-term liabilities (£10,000) that outweigh its current assets, and its net current assets are positive but limited (£10,794). The financial "vital signs" show no critical distress but reveal early-stage fragility and limited capitalization. This merits a cautious "C" grade, reflecting a stable but vulnerable financial health typical of a new small business.

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2. Key Vital Signs

Metric	Value	Interpretation
Current Assets	£11,215	Healthy short-term resources (cash, debtors).
Current Liabilities	£421	Low immediate obligations to pay.
Net Current Assets	£10,794	Good short-term liquidity; "healthy cash flow".
Creditors > 1 Year	£10,000	Long-term debt represents a future cash outflow.
Net Assets (Equity)	£794	Very thin equity buffer; early-stage capitalization.
Number of Employees	1	Small, lean operation reducing overhead risks.
Company Age	~1 year	New business; financial history is limited.

Vital Signs Interpretation:
Vergolus Ltd exhibits a "healthy pulse" in terms of liquidity with positive working capital, indicating it can cover short-term obligations comfortably. However, the presence of significant long-term creditors relative to its equity signals potential "symptoms of financial strain" if profitability or cash inflows do not improve. The small equity base may limit the company's ability to absorb shocks. The company currently operates with minimal personnel, keeping fixed costs low.

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3. Diagnosis

Vergolus Ltd presents a picture typical of a micro-entity in its infancy. The financial "symptoms" suggest:

• Liquidity is currently stable, with current assets exceeding current liabilities comfortably.
• Long-term liabilities are high relative to equity, which could strain future financial stability if revenue generation does not scale up.
• Equity is minimal, indicating limited internal funding and a reliance on external financing or future profits to build strength.
• Operational scale is low, which helps reduce fixed costs but may limit revenue potential initially.
• No signs of overdue filings or regulatory issues, indicating good compliance and governance status.

Overall, the company’s financial "vital signs" show it is stable but vulnerable. It is in a delicate phase where careful financial management is crucial to avoid distress.

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4. Recommendations

To improve financial wellness and build resilience, the following steps are advised:

1. Strengthen Equity Base:
   Consider injecting additional capital or retaining earnings to increase net assets and cushion against potential losses.

2. Manage Long-Term Liabilities:
   Develop a clear repayment plan for the £10,000 long-term creditor balance to prevent debt overhang and interest burdens.

3. Enhance Revenue Streams:
   Focus on business development in core SIC industries (advertising and construction installation) to increase cash inflows and profitability.

4. Monitor Cash Flow Closely:
   Maintain healthy working capital by managing receivables and payables efficiently to avoid cash shortfalls.

5. Plan for Growth and Scaling:
   As the business grows, prepare for increased staffing and operational expenses without compromising liquidity.

6. Maintain Compliance:
   Continue timely filing of accounts and confirmation statements to avoid penalties and support good corporate reputation.

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