WILD CLOUDS LIMITED

Executive Summary

Wild Clouds Limited is currently experiencing significant financial distress, indicated by persistent negative working capital and net liabilities. The company has a fragile financial position with limited assets and minimal equity, risking insolvency if corrective actions are not taken. Immediate focus on improving liquidity, increasing capital, and managing costs is essential to restore financial health and ensure long-term viability.

WILD CLOUDS LIMITED - Analysis Report

Company Number: 13408002

Analysis Date: 2025-07-29 16:59 UTC

Financial Health Assessment for Wild Clouds Limited

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1. Financial Health Score: D

Explanation:
Wild Clouds Limited shows persistent and increasing net current liabilities and net negative assets over the past four years. This signals a financial condition similar to a patient with chronic symptoms of distress in their circulatory system—here, the circulation being cash flow and working capital. The company is "underweight" in equity and "overstretched" in liabilities, which compromises its financial resilience and growth capacity. While it remains active and compliant with filings, the financial fundamentals are weak, meriting a D grade. Immediate remedial action is advisable to prevent further deterioration.

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2. Key Vital Signs

Metric	2024 (£)	Interpretation
Current Assets	24,950	Limited short-term liquid assets to cover debts
Current Liabilities	79,527	High short-term obligations, creating liquidity pressure
Net Current Assets (Working Capital)	-54,577	Negative working capital, showing cash flow strain
Net Assets (Shareholders’ Funds)	-54,577	Negative equity indicates accumulated losses and insolvency risk
Share Capital	1.00	Minimal paid-in capital, limiting financial buffer
Average Number of Employees	1	Very small scale operation, possibly limiting revenue base

Interpretation:

• Negative Working Capital ("symptom of cash flow congestion"): The company cannot cover its short-term liabilities with its short-term assets, risking payment delays or defaults.
• Negative Net Assets ("symptom of chronic financial illness"): Indicates the company’s liabilities exceed its assets, reflecting accumulated losses and eroded equity capital.
• Minimal Share Capital ("low financial immunity"): With only £1 share capital, the company lacks a robust capital base to absorb shocks.
• Stable Operational Size ("stable but limited metabolic function"): With only one employee, the company’s scale is very small, potentially limiting revenue generation and operational flexibility.

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3. Diagnosis

Wild Clouds Limited is showing clear financial distress symptoms. The persistent negative working capital and net liabilities over four years suggest the company is living beyond its means—incurring liabilities faster than it can generate or hold sufficient assets. This condition resembles a patient with a chronic illness that has not been treated effectively, leading to gradual weakening of health.

There is no indication of fixed assets or other long-term assets which might provide collateral or value cushions. The situation is compounded by the minimal share capital, placing the sole director and shareholder at significant financial risk. Although the company remains solvent legally and is complying with filing deadlines, the underlying financial health is precarious.

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4. Recommendations

To improve financial wellness, the company should consider the following actions:

• Improve Liquidity ("restore healthy blood flow"):

  • Accelerate collection of receivables or increase cash reserves.
  • Negotiate with creditors to extend payment terms or reduce liabilities.

• Increase Capital Injection ("strengthen immune system"):

  • Consider additional share capital issuance or shareholder loans to improve equity base.
  • Explore external funding or investment to shore up financial reserves.

• Cost Management and Revenue Enhancement ("reduce metabolic strain"):

  • Review and reduce operational expenses wherever possible.
  • Explore new revenue streams or market opportunities to increase turnover.

• Financial Monitoring and Forecasting ("ongoing health check-ups"):

  • Implement regular cash flow forecasting and financial monitoring to catch symptoms early.
  • Seek professional advice to prepare recovery plans and restructure debt if necessary.

• Consider Strategic Restructuring ("treatment plan"):

  • If losses continue, evaluate options such as business model pivot, merger, or controlled downsizing to restore financial health.

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