WOOF WHISTLE WALK LTD

Executive Summary

WOOF WHISTLE WALK LTD demonstrates a profitable start with promising revenue and margins but shows concerning liquidity and leverage symptoms. The company must focus on improving cash reserves and managing its debt carefully to maintain healthy financial functioning and sustain growth. Early intervention will enhance its financial resilience and support long-term business success.

WOOF WHISTLE WALK LTD - Analysis Report

Company Number: 15162172

Analysis Date: 2025-07-20 18:55 UTC

Financial Health Assessment: WOOF WHISTLE WALK LTD (Year ended 30 Sep 2024)

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1. Financial Health Score: C

Explanation:
This micro-entity is in an early stage of operations (incorporated Sep 2023) and shows promising profitability but exhibits warning signs in liquidity and gearing. The score reflects moderate health with specific risks that need attention to avoid financial distress.

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2. Key Vital Signs

Metric	Value (£)	Interpretation
Turnover	211,543	Healthy initial revenue generation for a start-up in its first year.
Profit	47,643	Positive bottom line indicates effective cost control and business viability.
Fixed Assets	138,077	Significant investment in long-term assets relative to company size, indicating capital commitment.
Current Assets	9,893	Very low liquid assets compared to liabilities, signaling potential cash flow issues.
Current Liabilities	15,687	Current debts exceed current assets, resulting in negative working capital (net current liabilities).
Net Current Assets	-5,794	"Symptoms of distress" in short-term liquidity; may struggle to meet near-term obligations.
Creditors > 1 year (Long Term Liabilities)	119,131	High level of long-term debt creates financial leverage and risk of solvency pressure.
Net Assets / Shareholders' Funds	13,152	Positive equity but very modest, reflecting early stage and significant liabilities.
Employees	1	Lean operation, potentially limiting scalability and risk diversification.

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3. Diagnosis

• Profitability: The company made a net profit of £47,643 on a turnover of £211,543, which is a solid margin (~22.5%). This suggests the core business model is viable and generating healthy returns.

• Liquidity: Despite the profit, the company shows negative working capital (£9,893 current assets vs £15,687 current liabilities). This "symptom" is critical: it means the company may face short-term cash flow difficulties and could struggle to pay bills on time without additional cash inflows or credit.

• Leverage: The company carries long-term creditors of £119,131, a large sum relative to net assets of £13,152. This gearing indicates reliance on external financing. While not uncommon for a start-up investing in fixed assets (£138,077), this level of debt heightens solvency risk if profits do not continue or cash flow tightens.

• Asset Structure: The fixed assets are substantial for a micro-entity, suggesting a capital-intensive business or significant start-up investment. However, the low current assets may mean funds are tied up in non-liquid form.

• Operational Efficiency: Staff costs (£56,071) and other charges (£96,460) are well managed relative to turnover. Depreciation (£9,770) aligns with fixed asset investment.

• Governance and Control: Sole director and 100% shareholder control indicates centralized decision-making. This can be positive for agility but may limit oversight.

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4. Recommendations

1. Improve Liquidity:

   • Build up cash reserves to cover at least current liabilities to avoid "cash flow shock."
   • Negotiate longer payment terms with suppliers or seek short-term lines of credit to smooth operational cash flow.

2. Debt Management:

   • Monitor and plan for repayment of long-term creditors to prevent solvency risk.
   • Explore restructuring or refinancing options if cash flow tightens.

3. Asset Utilization:

   • Review fixed asset deployment to ensure maximum return on investment.
   • Consider asset disposals or leasing options if capital is tied up inefficiently.

4. Growth and Diversification:

   • With only one employee and a narrow operational base, consider scaling carefully to balance growth with financial stability.
   • Maintain tight cost controls to preserve profitability.

5. Financial Monitoring:

   • Implement regular cash flow forecasting and stress testing to anticipate liquidity needs.
   • Prepare for formal audit or review once turnover or asset thresholds exceed micro-entity limits.

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