AJ PLANT HIRE (WALES) LTD

Executive Summary

AJ Plant Hire (Wales) Ltd is a very small company with improving but limited financial strength, showing steady growth in net assets and working capital. The business maintains adequate liquidity for current operations but has minimal capital reserves, necessitating cautious credit extension with ongoing monitoring. Overall, the company’s creditworthiness is conditional on its ability to sustain cash flow and manage liabilities prudently.

AJ PLANT HIRE (WALES) LTD - Analysis Report

Company Number: 13261707

Analysis Date: 2025-07-20 17:46 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   AJ Plant Hire (Wales) Ltd demonstrates modest but consistent growth in net assets and working capital over the last three years, moving from a net liability position at incorporation to positive net assets of £270 as of March 2024. However, the company's financial scale is very small (micro-entity category) with limited capital and minimal fixed assets, signaling limited financial buffer. Credit should be extended with caution and conditions, including periodic financial reviews and limits aligned with the company's size and cash flow capacity.

2. Financial Strength:
   The balance sheet shows a positive trajectory: net current assets have increased from £258 in 2023 to £599 in 2024, and net assets improved from £108 to £270. Current assets rose significantly mainly through cash or equivalents, indicating improved liquidity. The company maintains minimal liabilities, but equity remains very low. The absence of long-term assets or significant equity means the company has limited collateral or capital strength. The small share capital (£2) further underscores limited financial backing.

3. Cash Flow Assessment:
   The increase in current assets coupled with a proportional rise in current liabilities results in modest positive working capital, supporting operational liquidity. Accruals and deferred income increased but remain manageable. The company’s ability to meet short-term obligations appears adequate at present, supported by two employees only, which suggests a lean cost base. However, with limited financial reserves, the company may be vulnerable to cash flow shocks or delayed receivables.

4. Monitoring Points:

• Continue monitoring quarterly liquidity metrics, especially current ratio and net cash position.
• Watch for any significant growth in liabilities or slow-paying debtors that could strain working capital.
• Review management’s ability to control costs and maintain positive operational cash flow.
• Assess any changes in the industry environment or project pipeline that could impact revenue stability.
• Verify timely filing of accounts and confirmation statements to avoid compliance risks.