WHITELYTE LIMITED

Executive Summary

Whitelyte Limited shows a positive but fragile financial position typical of a young micro-entity. The company maintains healthy short-term liquidity but has a very low equity base and significant deferred income that require careful management. To improve financial resilience, Whitelyte should focus on strengthening its equity, managing deferred income, and closely monitoring cash flow.

WHITELYTE LIMITED - Analysis Report

Company Number: 14175606

Analysis Date: 2025-07-20 15:00 UTC

Financial Health Assessment of Whitelyte Limited (as of 30 June 2024)

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1. Financial Health Score: C

Explanation:
Whitelyte Limited demonstrates a modest but positive financial position with net current assets and positive net assets, indicating the company is solvent and can meet short-term obligations. However, the very low net asset base (£668) and the presence of significant deferred income/accruals relative to net assets signal some financial fragility. The company shows some symptoms of early-stage business growing pains rather than strong financial robustness, consistent with its recent incorporation and micro-entity scale.

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2. Key Vital Signs

Metric	2024 Figure	Interpretation
Fixed Assets	£2,250	Low investment in long-term assets; typical for micro-business.
Current Assets	£38,299	Healthy increase from prior year; strong short-term asset base (cash, debtors, stock).
Current Liabilities	£33,206	Significant short-term debts but manageable given current assets.
Net Current Assets	£5,093	Positive working capital; company can cover short-term obligations with a small buffer.
Accruals and Deferred Income	£6,675	Relatively high deferred income; could indicate prepayments received or revenue recognition timing issues.
Net Assets (Shareholders' Funds)	£668	Very low equity base; signals limited financial cushion and potential vulnerability.
Employee Count	1	Micro entity with minimal staffing, limiting operational scale.

Interpretation:

• The increase in current assets, more than doubling from £16k to £38k, is a positive sign of improved liquidity.
• The company maintains positive net current assets, a vital sign of "healthy cash flow" capability to meet immediate obligations.
• However, the net assets have decreased from £1,127 to £668 despite growth in current assets, mainly due to increased accruals/deferred income, which are liabilities or obligations not yet reflected as revenue.
• The minimal fixed assets and low equity base suggest limited capital investment and cushion to absorb shocks.

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3. Diagnosis

Whitelyte Limited is in an early-life stage typical of micro private companies, showing signs of operational activity growth but limited financial resilience. The positive net current assets indicate the company is currently healthy enough to meet short-term debts, like a patient with stable vital signs but a low overall reserve of strength.

The "symptoms of distress" to watch include the very low net assets and the growing deferred income/accruals, which could represent pending obligations or revenue recognition timing issues. These may put pressure on cash flow and require careful management to avoid liquidity crunches.

The company's small scale (one employee) and micro-entity status imply it is still establishing its market position and financial footing. The balance sheet shows a delicate balance between assets and liabilities, with little room for unexpected financial stress.

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4. Recommendations

• Improve Equity Base: Consider injecting additional capital or retaining earnings to build a stronger equity buffer, which acts as the company's "immune system" against financial shocks.
• Manage Deferred Income: Review the nature and timing of deferred income/accruals to ensure they do not mask cash flow issues or future liabilities. Clear communication with customers and suppliers may help smooth revenue recognition cycles.
• Enhance Cash Flow Monitoring: Maintain close oversight of working capital metrics to ensure liquidity remains "healthy" and avoid short-term cash shortfalls.
• Cost Control and Revenue Growth: Given the small scale, focus on controlled expense management and targeted growth initiatives to strengthen profitability and overall financial health.
• Prepare for Scaling: If expansion is planned, develop a financial plan to support increased fixed asset investment and staffing while maintaining financial stability.

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