ADAM CHIPPY LIMITED

Executive Summary

Adam Chippy Limited, a newly formed micro-entity in the take-away food sector, shows early-stage financial distress with negative net assets and a significant working capital deficit, raising solvency and liquidity concerns. While compliant with statutory filings, the limited trading history and absence of profit and loss disclosure impede a full assessment of operational viability. Further financial and operational due diligence is recommended before considering investment.

ADAM CHIPPY LIMITED - Analysis Report

Company Number: 14785700

Analysis Date: 2025-07-20 12:42 UTC

1. Risk Rating: HIGH

The company exhibits a high risk profile primarily due to negative net assets, significant working capital deficiency, and its very recent incorporation with limited operating history.

2. Key Concerns:

• Negative Net Assets: The company reported net liabilities of £4,409 as at 30 April 2024, indicating the company’s liabilities exceed its assets, which is a solvency concern.
• Severe Working Capital Deficit: Current liabilities of £42,926 outweigh current assets of £2,517, resulting in a net current liability position of £40,409. This suggests potential liquidity issues in meeting short-term obligations.
• Limited Operational History: Incorporated in April 2023, the company has less than one full year of trading history. The absence of a profit and loss account filing limits insight into revenue generation and operational performance.

3. Positive Indicators:

• Compliance with Filing Requirements: The company is up to date with accounts and confirmation statement filings with no overdue filings, demonstrating regulatory compliance.
• Micro-Entity Reporting: The company benefits from simplified financial reporting standards, reducing administrative burden.
• Clear Ownership Structure: Two persons with significant control (each holding 25-50% shares and voting rights) are identified, indicating transparent control.

4. Due Diligence Notes:

• Review Cash Flow and Revenue Generation: Obtain management accounts or bank statements to assess ongoing cash flow and ability to cover short-term liabilities.
• Examine Profit and Loss Data: Request internally prepared profit and loss statements to evaluate business sustainability and profitability trends.
• Investigate Capital Injection Plans: Ascertain if there are plans for further equity injection or financing to address negative net assets and working capital shortfall.
• Assess Director Backgrounds: Conduct checks on directors for any adverse records or prior insolvencies given the financial position.
• Understand Business Model and Market Position: Given SIC code 56103 (take-away food shops), evaluate competitive environment, customer base, and growth prospects.