Company Number: 13143044

Analysis Date: 2025-07-20 17:36 UTC

1. Credit Opinion: DECLINE
   Ada 72 Limited currently shows significant financial distress with net liabilities of £67,611 as of January 2024 and a negative net current asset position of £48,220. The company is highly leveraged, with long-term liabilities of £110,000 exceeding its tangible fixed assets and working capital. Given the ongoing losses, negative equity, and insufficient liquidity (cash £46,793 vs. current liabilities £105,013), the company’s ability to meet short-term obligations and service debt is questionable. The business is a relatively new licensed restaurant (incorporated 2021) and has not demonstrated financial stability or profitability. Without substantial improvement in cash flow or additional capital injection, credit exposure poses high risk.

2. Financial Strength:
   The balance sheet reveals weak financial health. Tangible fixed assets net of depreciation amount to £90,609, but total liabilities—both current and long-term—exceed total assets by £67,611. Shareholders’ funds are negative, indicating accumulated losses or capital erosion. Current liabilities nearly double current assets, resulting in a working capital deficit. The share capital is nominal (£1), pointing to limited equity buffer. The company’s financial position is fragile, with no retained earnings visible to support operations or absorb shocks.

3. Cash Flow Assessment:
   The company holds £46,793 in cash, which is insufficient to cover its current liabilities of £105,013, resulting in liquidity pressure. The working capital deficit of £48,220 suggests that Ada 72 Limited may struggle to meet immediate obligations without relying on additional financing or operational cash inflows. The absence of any reported turnover or profitability in the accounts, combined with a large creditor balance, underscores concerns about ongoing cash generation capability and the risk of default.

4. Monitoring Points:

• Improvement in profitability and net asset position in the next accounts filing.
• Reduction in current liabilities and improvement in working capital ratio.
• Cash flow statements demonstrating positive operating cash flow.
• Any capital injections or refinancing arrangements to strengthen liquidity.
• Director’s plans and business strategy to restore financial viability.
• Timely filing of accounts and confirmation statements to maintain regulatory compliance.