Company Number: 13909816

Analysis Date: 2025-07-20 15:27 UTC

1. Credit Opinion: DECLINE
   Al Halal Cosmetics Ltd presents a weak credit profile. The company shows persistent negative net current assets and shareholders’ funds, indicating ongoing financial distress. Although there was a modest improvement in retained earnings in 2024, the company remains significantly undercapitalized with liabilities exceeding assets. The minimal cash balance (£120) and substantial current liabilities (£4,421) raise concerns about its ability to meet short-term obligations and service any extended credit. Given its short operating history (since 2022) and lack of audited financials, the risk of default is high.

2. Financial Strength:
   The balance sheet shows continued erosion of equity with shareholders’ funds at negative £4,401 as of February 2024, improving from negative £10,464 the prior year but still deeply negative. The company holds no fixed assets and only nominal cash, with current liabilities exceeding current assets by £4,301. The negative net current assets position highlights working capital deficiencies. The absence of tangible assets and reliance on limited cash severely limit collateral availability for lending.

3. Cash Flow Assessment:
   Cash balances are critically low, around £120, insufficient to cover current liabilities of £4,421. This indicates a liquidity crunch and weak operational cash flow generation. The company’s working capital is negative, suggesting dependence on external funding or credit to sustain operations. The absence of disclosed turnover or profitability metrics in the accounts restricts further cash flow analysis, but the negative equity and net liabilities imply ongoing losses.

4. Monitoring Points:

• Improvements in liquidity and working capital position
• Evidence of sustainable profitability and positive cash flows
• Changes in creditor terms or debt restructuring efforts
• Any capital injections or equity funding to improve financial stability
• Timely filing of accounts and transparency in financial reporting