Company Number: 13133290

Analysis Date: 2025-07-20 12:21 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   68 Degrees Heating Limited is a micro-entity operating in the plumbing and heating installation sector. The company is currently active with a single director who also appears to be the sole employee. The financials indicate a decline in net assets from £18,935 in 2023 to £10,309 in 2024, reflecting a reduction in both fixed and current assets and an increase in longer-term creditors. While the company maintains a positive net asset position and working capital, the downward trend in equity and asset base suggests some financial stress. Credit approval is conditional on monitoring future filings closely and obtaining updated cash flow projections to ensure continuing debt servicing capability.

2. Financial Strength:
   The balance sheet shows net assets of £10,309 as of January 31, 2024, down from £18,935 the previous year. Fixed assets decreased from £13,781 to £10,336, and current assets fell from £28,912 to £20,289. Current liabilities slightly decreased from £6,916 to £6,918, but long-term creditors (creditors falling due after one year) increased from £16,842 to £13,398 (note: actually decreased). The company's shareholders' funds mirror net assets, characteristic of a small private limited company with minimal share capital (£1). The reduction in net assets and working capital indicates weakening financial resilience but no immediate solvency concerns given positive net current assets of £13,371.

3. Cash Flow Assessment:
   The company’s current assets exceed current liabilities by £13,371, indicating sufficient short-term liquidity to cover immediate obligations. However, the drop in current assets and net assets year-on-year implies potential cash flow tightening. The absence of detailed cash flow statements limits full assessment, but the small scale operation with one employee suggests relatively low overheads. Monitoring debtor collections and creditor payment terms is advised to ensure ongoing liquidity.

4. Monitoring Points:

• Trend in net assets and equity to detect further erosion.
• Changes in current and long-term liabilities for signs of increasing debt burden.
• Timeliness and completeness of future accounts and confirmation statements.
• Cash flow statements or management accounts to verify liquidity and operational cash generation.
• Any changes in director or ownership structure that may impact governance or credit risk.