Company Number: 13710704

Analysis Date: 2025-07-20 17:38 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity concerns, primarily due to substantially negative net current assets and high current liabilities relative to current assets. The large outstanding bank loans and current liabilities dwarf the company’s cash and debtor balances, indicating potential difficulty in meeting short-term obligations.

2. Key Concerns:

• Negative Net Current Assets: The company’s net current assets stand at approximately -£223k (2023) and were even worse in the prior year, indicating working capital deficit and potential cash flow problems.
• High Current and Long-Term Liabilities: The company has current liabilities of £253,764 and long-term bank loans of £457,379, which are considerable relative to its total assets and equity of only £9,068.
• Minimal Share Capital and Equity Buffer: The share capital is nominal (£100), and shareholders’ funds are very low (£9,068), which limits the company’s ability to absorb losses or raise new equity in distress.

3. Positive Indicators:

• Growth in Investment Property Asset Value: The investment property has increased from £656,840 to £689,692, reflecting some appreciation or capital investment in assets.
• Profitability in Latest Year: The company reported a profit of £7,618 in the most recent year, which helped increase retained earnings, showing some operational profitability.
• No Filing or Compliance Overdue: The company is up-to-date with accounts and confirmation statement filings, indicating regulatory compliance.

4. Due Diligence Notes:

• Investigate the terms, repayment schedule, and security of the bank loans totaling over £457k to assess refinancing risk and potential covenant breaches.
• Review cash flow statements and financial projections to confirm the company’s ability to service current liabilities and loans.
• Clarify the nature and valuation method of the investment property to verify if the asset base is realistically realizable in distress.
• Assess the background and creditworthiness of the directors and controlling parties for any governance or reputational risks.
• Confirm if there are any contingent liabilities or off-balance-sheet obligations not disclosed.