Company Number: 13119461

Analysis Date: 2025-07-20 14:28 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   ABM Grocery Ltd presents improving financial metrics with positive net assets and shareholder funds growth from £11.7k in 2023 to £45.5k in 2024, indicating strengthening equity. However, the company carries a significant long-term liability (£84,000) owed to group undertakings, which may constrain financial flexibility. The positive working capital position and increased cash balance are encouraging but the current liabilities remain substantial at £84,000 annually. Lending should be considered with conditions requiring ongoing monitoring of liquidity and debt servicing capacity, particularly given the company's young age and limited operating history.

2. Financial Strength:
   The balance sheet shows total assets less current liabilities increased to £129,506 (2024) from £95,772 (2023), driven by growth in current assets (notably cash rising from £3,514 to £33,510) and stable fixed assets (~£65k). Current liabilities remain steady at £84,000, but net current assets have nearly tripled to £63,897, indicating improved short-term financial health. The company has positive net assets of £45,506, a significant turnaround from a negative net asset position in 2021 (-£10,224). The long-term creditor balance remains unchanged, suggesting related party funding rather than external debt.

3. Cash Flow Assessment:
   Cash reserves improved markedly to £33,510 in 2024, enhancing liquidity and ability to cover short-term obligations. Debtors are minimal (£5,000), and stock levels steady (£35,000), supporting working capital adequacy. The net current asset position of £63,897 reflects sufficient liquidity to meet current obligations. However, the fixed long-term creditor balance of £84,000 requires scrutiny to ensure the company can service or refinance this liability as it falls due.

4. Monitoring Points:

• Maintain close watch on cash flow trends and creditor repayment schedules, especially the £84,000 owed to group undertakings.
• Monitor changes in stock and debtor levels to avoid working capital strain.
• Track profitability and retained earnings to support continued equity growth.
• Assess director and shareholder activities for related party transactions impacting financial stability.
• Review annual accounts promptly at next filing to confirm ongoing financial improvement and compliance.