ABU AFIF CAMDEN LTD

Executive Summary

The company, ABU AFIF CAMDEN LTD, is a newly incorporated restaurant business exhibiting a negative equity position and substantial long-term liabilities shortly after formation, placing it at high financial risk. While current assets marginally exceed short-term liabilities and compliance filings are current, significant concerns arise from its reliance on director financing and overall solvency. Further investigation into creditor terms, director loans, and operational cash flow is recommended to fully assess sustainability.

ABU AFIF CAMDEN LTD - Analysis Report

Company Number: 15166651

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

1. Risk Rating: HIGH
   The company shows significant negative net assets (£-139,773) shortly after incorporation, indicating a substantial deficit relative to equity. The existence of considerable long-term liabilities (£238,500) versus limited tangible assets (£33,207) and low cash (£3,087) raises concerns about solvency and financial stability.

2. Key Concerns:

• Negative Equity Position: The shareholder deficit of approximately £140k suggests the company is insolvent on a balance sheet basis, which is a critical red flag.
• High Long-term Creditors: Creditors due after more than one year amount to £238,500, which, without corresponding assets or cash flow, implies potential difficulties in meeting obligations when they fall due.
• Director Loan Liability: The company owes a director £127,400, indicating reliance on related party funding rather than external financing or operational cash flow.

3. Positive Indicators:

• Current Assets Slightly Exceed Current Liabilities: Net current assets stand at £65,520, which indicates that in the short term, the company has some ability to cover immediate liabilities.
• Timely Filings and Compliance: All statutory filings are up to date with no overdue accounts or confirmation statements, suggesting compliance with regulatory requirements.
• Clear Ownership and Management Structure: The company has two current directors with full control documented, which may facilitate decisive governance and business decisions.

4. Due Diligence Notes:

• Investigate the nature and terms of the long-term creditors (£238,500) to assess repayment schedules and any associated covenants or risks.
• Examine the director loan (£127,400) arrangements to understand repayment terms, interest, and whether this funding is sustainable or convertible.
• Obtain more detailed cash flow forecasts and profit and loss data (not included in the abridged accounts) to evaluate operational viability and future liquidity.
• Assess the business plan and market positioning in the unlicensed restaurant and café sector to determine prospects for revenue generation and profitability.
• Confirm that no director disqualifications or governance issues exist beyond the publicly available data.