AJB BUILDING AND LANDSCAPING SERVICES LIMITED
Executive Summary
AJB Building and Landscaping Services Limited demonstrates a stable financial position with adequate liquidity and positive net assets, though there is a slight declining trend that warrants attention. The company’s single-director structure concentrates risk but also ensures clear governance. Conditional credit approval is recommended with ongoing financial monitoring to safeguard repayment capacity and business resilience.
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This analysis is opinion only and should not be interpreted as financial advice.
AJB BUILDING AND LANDSCAPING SERVICES LIMITED - Analysis Report
Credit Opinion: CONDITIONAL APPROVAL
AJB Building and Landscaping Services Limited is a small, relatively young company with a stable financial position. The company has positive net assets and net current assets, indicating adequate short-term liquidity to meet obligations. However, the company's net assets and net current assets have declined slightly in the latest year, and the business is reliant on a single director and shareholder, which concentrates control and risk. There is also some finance lease debt outstanding, though manageable. Approval is recommended with conditions including regular financial monitoring and a review of cash flow forecasts to ensure ongoing debt servicing capacity.Financial Strength:
The balance sheet shows net assets of £20,163 as of June 2024, slightly down from £21,683 in the prior year, reflecting a marginal weakening in equity. Fixed assets have decreased by approximately £3,457, likely due to depreciation and amortisation, while current assets remain stable at around £51,792. Current liabilities are steady at about £44,636. The company maintains positive net current assets of £7,156, which is a modest but sufficient buffer for short-term obligations. The finance lease obligations have reduced to £3,863 from £6,760, which improves leverage but still represents a liability to be managed carefully.Cash Flow Assessment:
The company holds a strong cash position of £48,603, which covers current liabilities effectively, contributing to liquidity strength. Debtors are modest at £3,189, suggesting reasonable collection practices, though a slight decline from the previous year. The working capital position is positive but has decreased slightly from £8,116 to £7,156, indicating a minor tightening of liquidity. The company’s ability to convert current assets into cash appears solid, but monitoring is advised due to the slight downward trend.Monitoring Points:
- Track net current assets and cash balances regularly to ensure liquidity does not deteriorate further.
- Monitor finance lease repayments and any new debt to avoid over-leverage.
- Review profit and loss trends (not available here) for signs of earnings pressure that could affect reserves and cash flow.
- Keep oversight on director’s management decisions and any changes in control or ownership that could impact business continuity.
- Confirm timely filing of accounts and returns continues, as observed.
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