ALBION HOUSE VG LIMITED

Executive Summary

Albion House VG Limited is a newly formed real estate company with a leveraged capital structure. The company currently shows positive working capital and significant property assets, but a negative net equity position reflecting start-up phase financing. Conditional credit approval is recommended, contingent on monitoring asset liquidity, loan servicing, and cash flow viability as the business develops.

ALBION HOUSE VG LIMITED - Analysis Report

Company Number: 15435804

Analysis Date: 2025-07-19 12:15 UTC

1. Credit Opinion:
   CONDITIONAL APPROVAL. Albion House VG Limited is a newly incorporated property company engaged in buying and selling its own real estate. The company has a significant level of secured debt (£1.37M) against its property asset. While it shows positive net current assets of £1.29M indicating short-term liquidity, the overall net liabilities position (£-80.7k) reflects initial negative equity due to early-stage operational costs and financing structure. Approval is conditional on ongoing monitoring of asset valuations, repayment capability on the long-term bank loan, and confirmation of stable cash flows from property sales or rentals.

2. Financial Strength:
   The balance sheet shows current assets of £1.58M dominated by stock (property inventory) of £1.53M, debtors £37k, and minimal cash (£11k). Current liabilities are £288k, leaving healthy net current assets of £1.29M. However, long-term liabilities (bank loans) total £1.37M, secured against the property. The net asset deficit of £80.7k is not unusual for a start-up real estate company with leveraged financing. The asset base appears strong but is heavily tied to property stock, which may fluctuate in value. Shareholders’ funds are negative, reflecting the early stage and financial structure.

3. Cash Flow Assessment:
   Cash at bank is low (£11k) which may constrain immediate liquidity, but net current assets remain positive due to stock and receivables. The company must ensure that property stock can be sold or refinanced in a timely manner to meet both current liabilities and scheduled repayments on the secured loan. The absence of income statement data limits full cash flow visibility, so further inquiry into projected sales and rental income is recommended. Working capital appears sufficient short-term but cash conversion cycles are key.

4. Monitoring Points:

• Regular updates on property valuations and sales progress to assess asset liquidity and impairment risk.
• Timely servicing of bank loans, especially long-term installments secured on property.
• Cash flow forecasts focusing on sales pipeline and rent receipts if applicable.
• Monitoring any changes in debtor balances and creditor terms to avoid liquidity strain.
• Management updates on business plan execution and any refinancing plans.