3I CONSTRUCTIONS LTD

Executive Summary

3i Constructions Ltd faces high solvency and liquidity risks, with significant negative working capital and persistent net liabilities indicating financial distress. While regulatory compliance is current and governance appears stable, the company’s ability to meet short-term obligations is questionable without remedial actions or capital injection. Further due diligence is recommended to clarify creditor composition, cash flows, and operational viability.

3I CONSTRUCTIONS LTD - Analysis Report

Company Number: 13142340

Analysis Date: 2025-07-29 20:58 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency concerns, with net current liabilities and net assets persistently negative over multiple years, indicating an inability to meet short-term obligations. The scale of current liabilities compared to current assets is disproportionate and worsening.

2. Key Concerns:

• Severe Negative Net Current Assets: As of 31 March 2024, net current liabilities stand at approximately £219,933, a sharp increase from previous years, signaling acute liquidity risk.
• Consistent Net Liabilities and Negative Shareholders’ Funds: Net assets are negative (£8,324 in 2024), reflecting accumulated losses and insufficient equity buffer, undermining solvency.
• High Trade Creditors and Other Creditors: Trade creditors (£217,878) dominate current liabilities, raising questions about payment terms and supplier confidence.

3. Positive Indicators:

• Active Compliance and Timely Filings: The company is current with both accounts and confirmation statement filings, reducing regulatory risk.
• Small Employee Base: With an average of 3 employees, fixed overheads may be manageable, potentially limiting cash burn.
• No Indication of Director Disqualifications or Governance Issues: Directors appear in good standing with no reported disqualifications or resignations linked to financial distress.

4. Due Diligence Notes:

• Investigate the nature and terms of the substantial trade creditors and other creditors, including whether these represent extended supplier credit or potential unpaid obligations.
• Review cash flow statements and management forecasts to assess short-term liquidity and plans to reduce current liabilities.
• Examine the company’s business model and contracts to understand revenue generation, given the classification in residents property management and the very low fixed asset base.
• Clarify the director loan balance and its terms, as well as the capacity of the current director to support the company financially if needed.