Company Number: 13630502

Analysis Date: 2025-07-20 15:39 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity concerns, evidenced by substantial negative net assets and large current liabilities far exceeding current assets. This financial position presents a high risk of the company being unable to meet its short-term obligations.

2. Key Concerns:

• Severe Negative Net Assets: The net assets have deteriorated from approximately -£13.9k in 2022 to -£109.9k in 2023, indicating increasing accumulated losses and declining financial health.
• Negative Working Capital: Current liabilities (£162,174) greatly exceed current assets (£35,004) as of 2023 year-end, resulting in a negative net current asset position of -£127,170, which signals liquidity stress.
• Declining Employee Count and Operational Scale: The average number of employees fell from 5 in 2022 to 3 in 2023, which may indicate operational contraction or cost-cutting due to financial pressures.

3. Positive Indicators:

• No Overdue Filings: Both accounts and confirmation statement filings are up to date, suggesting compliance with statutory requirements and good governance in this regard.
• Active Status with Established Directors: The company remains active with directors appointed recently, including a new director as of September 2024, which may indicate ongoing management engagement.
• Tangible Fixed Assets Growth: The company increased tangible fixed assets net book value from £9,135 in 2022 to £21,269 in 2023, demonstrating some investment in operational capacity.

4. Due Diligence Notes:

• Investigate the nature and timing of the large current liabilities to assess if these are short-term trade payables, loans, or other financial obligations and the company's plans for repayment or restructuring.
• Review management accounts, cash flow forecasts, and any external financing arrangements to understand liquidity management and going concern status.
• Explore the company’s revenue trends and profitability data, currently unavailable in filed accounts, to assess operational sustainability and identify causes of losses.
• Assess the impact of the COVID-19 pandemic or other external factors on trading performance, given the industry (unlicensed restaurants and cafes) is sensitive to such disruptions.
• Confirm the background and track record of directors, especially the majority shareholder, to evaluate management capability and integrity.