Company Number: 12592311

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

1. Credit Opinion: CONDITIONAL APPROVAL
   AJM Prop Services Limited is an active private limited company operating in management consultancy and real estate letting. The company’s net assets improved modestly from £1,001 in 2023 to £2,747 in 2024, indicating incremental balance sheet strengthening. However, the company exhibits persistent net current liabilities (working capital deficits), increasing from -£3,877 in 2023 to -£11,022 in 2024. This raises concerns about short-term liquidity and the ability to meet current obligations without relying on external support or director funding. The directors appear committed, with shareholding and control concentrated within a family group, which can be positive for governance continuity. Given the working capital pressure, credit facilities should be structured conservatively and potentially require additional security or covenants.

2. Financial Strength:
   The company’s fixed assets increased significantly in 2024, mainly due to additions in plant, machinery, and fixtures (£10,684 additions), raising net fixed assets to £13,769. This indicates some investment in operational capacity or asset base expansion. Shareholders’ funds remain low but have nearly tripled from £1,001 to £2,747, demonstrating a positive retained earnings movement. However, the balance sheet remains small and stretched, with current liabilities (£19,839) exceeding current assets (£8,817). The absence of long-term liabilities simplifies the capital structure but highlights reliance on short-term creditors and possibly director loans. The company’s limited capitalization (£100 share capital) also limits loss absorption capacity.

3. Cash Flow Assessment:
   Cash at bank dropped materially from £18,632 in 2023 to £2,230 in 2024, a significant liquidity decline. Debtors increased sharply to £6,587 from £668, which may reflect slower collections or more credit sales, further stressing cash flow. Current liabilities remain high, notably corporation tax (£7,003) and taxes/social security (£2,676), suggesting significant near-term cash outflows. Persistent negative working capital and declining cash reserves pose a risk to ongoing liquidity. The company should be monitored closely for its ability to generate operating cash flows or secure timely financing to cover short-term obligations.

4. Monitoring Points:

• Liquidity ratios and cash conversion cycle to track improvement or deterioration in working capital management.
• Creditors aging and debtor collection performance to assess cash flow predictability.
• Profitability and retained earnings trends to confirm improving net asset base.
• Any director loan movements or injections to support liquidity.
• Compliance with filing deadlines and any changes in company status or control.