FRONTIER SUPPORT SERVICES LTD

Financial Health Score: B Explanation: The company possesses a fundamentally strong constitution with healthy liquidity and positive net assets. However, it is currently experiencing a mild illness—a loss for the year driven by a significant provision for bad debts and declining cash reserves. While not in critical condition, it requires prompt treatment to prevent further deterioration.

1. Key Vital Signs

• Blood Pressure (Liquidity & Working Capital): The company's current ratio is approximately 1.71 (Current Assets of £1.18m divided by Current Liabilities of £692k). This is a healthy reading, well above the danger zone of 1.0, indicating it has more than enough short-term assets to cover its immediate obligations.
• Heartbeat (Cash Reserves): Cash at bank stands at £573,888. While this is a strong pulse, it has slowed down from £663,021 in the prior year. The company is bleeding cash, though not at a fatal rate.
• Metabolism (Profitability): The Profit & Loss reserve dropped from £560,702 to £521,093, indicating a loss of roughly £39,609 for the year. The metabolism has slowed, largely because the body is fighting off an infection (a £127,417 provision for doubtful debts).
• Circulation (Debtors): Total debtors stand at £612,140, up from the previous year. The blood is taking longer to circulate, and a portion is currently blocked (accrued income and trade debtors with a combined provision of £140,681 against them).

2. Diagnosis

Frontier Support Services Ltd is an established, active care provider with a robust underlying financial structure. However, the financial data reveals symptoms of localized distress. The primary ailment is a sudden and significant issue with receivables, resulting in a £127,417 provision for doubtful debts. This "infection" directly caused the company to post a loss for the year, despite otherwise healthy operations.

Furthermore, the company has a portion of its financial energy tied up in a related party transaction. It is owed £220,786 by Hope Farm Properties LLP (including £50,786 of accrued interest), which is acting as a bit of a blood clot, restricting cash flow. Finally, the drop in average employee headcount from 187 to 165 suggests a contraction in operations, which may be a natural immune response to reduced cash flow or a strategic downsizing.

3. Recommendations

To restore full financial wellness, the following treatment plan is recommended: * Treat the Infection (Credit Control): Implement stricter credit checks and more aggressive collection procedures. The £127k bad debt provision shows a vulnerability in collecting from local authorities or private clients. Tightening up invoicing and follow-up processes will prevent future bad debt "infections." * Clear the Blood Clot (Related Party Loans): Work out a repayment plan with Hope Farm Properties LLP. Recovering the £220,786 owed would instantly replenish cash reserves and improve the company's financial stamina. * Monitor Vital Signs (Cash Flow Management): With cash down by nearly £90k and a smaller workforce, it is crucial to monitor cash burn rates closely. Delay non-essential capital expenditures until cash reserves stabilize. * Maintain a Balanced Diet (Cost Control): Ensure that overheads are appropriately scaled to the new, smaller workforce size. Streamlining operations without compromising the quality of care will help return the metabolism (profitability) to a positive state.