ADI NETWORK LIMITED

Executive Summary

ADI Network Limited is a newly established small private limited company with a weak standalone financial position characterized by negative shareholders’ funds and net current liabilities. Its minimal liquidity and absence of profitable trading history limit its ability to service debt or manage credit risk effectively. Without significant improvement in financial metrics or evidence of strong group support, credit facilities are not recommended at this stage.

ADI NETWORK LIMITED - Analysis Report

Company Number: 15163535

Analysis Date: 2025-07-20 18:16 UTC

1. Credit Opinion: DECLINE

ADI Network Limited is a newly incorporated small private limited company operating in driving school activities. The company has just completed its first financial period ending 31 December 2024. The financial data shows significant net current liabilities (£131,948) and negative shareholders’ funds of the same amount. The company has minimal cash (£100) and debtors are recorded as negative (£131,949), indicating possible intercompany balances or accounting classifications that do not represent liquid assets. The absence of trading profit and accumulated losses in the first year is expected, but the large negative equity and working capital deficit signal weak financial footing. The company is still in its infancy with only two employees on average and limited operational history. Directors have changed during the year, which may indicate some initial instability or restructuring. Given the negative net asset position and insufficient liquidity, the company currently lacks the financial strength to reliably service new credit facilities or repay debt. Furthermore, there is no evidence of positive cash flow generation or a track record of profitability to support creditworthiness. The parent company is Capsil Limited, and consolidated financials are available at the group level, but no assurance can be drawn from this subsidiary’s standalone position.

2. Financial Strength:

The balance sheet reveals negative net current assets of £131,948 and shareholders' funds of -£131,948 as well. The company’s only current liability is a small amount owed to group undertakings (£99). The fixed assets are not disclosed, suggesting minimal or no long-term asset base. The negative debtor figure suggests accounting treatment of intergroup balances rather than trade receivables. Overall, the company’s capital structure is weak with no retained earnings and a negative equity position, reflecting initial startup losses. The minimal cash balance indicates very limited liquidity buffer. The lack of tangible assets or reserves limits the company’s capacity to absorb financial shocks or raise funds independently.

3. Cash Flow Assessment:

Cash at bank is only £100, which is negligible for operational needs. With net current liabilities almost £132k, the company is in a working capital deficit position. The financial statements do not include a cash flow statement, but the available data implies the company is currently consuming cash rather than generating it. The small current liabilities amount primarily relate to amounts owed to group undertakings, which may be manageable within the group context. However, from a standalone perspective, liquidity is insufficient to cover short-term obligations or support debt servicing. There is no indication of external borrowing or access to credit facilities.

4. Monitoring Points:

• Track subsequent filings for improvements in working capital and net asset position.
• Monitor cash flow trends and operational profitability as trading progresses.
• Watch for any changes in director appointments or group support arrangements.
• Assess any related party transactions or intercompany loans that may impact liquidity.
• Review parent company group financials for potential support or guarantees.
• Monitor compliance with filing deadlines and any changes in accounting policies or disclosures.