ALCORE CONSTRUCTION LIMITED

Risk Rating: HIGH

Justification: ALCORE CONSTRUCTION LIMITED exhibits chronic technical insolvency, with negative net assets persisting for at least a decade and shareholders' funds standing at -£84,846 as of October 2024. The company is entirely dependent on non-current "other creditors" (likely director or related-party loans) to balance its books. Furthermore, operational anomalies—such as reporting zero employees while claiming to be an active construction firm—and a lack of P&L transparency significantly elevate the risk profile for institutional investors.

1. Key Concerns

• Chronic Technical Insolvency: The company's liabilities have consistently outstripped its assets for the entire 10-year period provided. Net assets are currently -£84,836, and with share capital at a nominal £10, the accumulated losses entirely erode any equity base. This raises substantial going concern doubts if the long-term creditors were to demand repayment.
• Operational and Disclosure Anomalies: The company reports zero employees for both 2024 and 2023, yet markets itself online as a "multi-disciplined business operating throughout Scotland" in construction and civil engineering. Additionally, the registered SIC code is 82110 (Combined office administrative service activities), which conflicts with the company's current branding. The director has also elected to file under section 444(5A) of the Companies Act 2006, opting out of providing a Profit & Loss account, which completely obscures revenue, margins, and operational profitability.
• Related Party Concentration: The balance sheet reveals £56,145 owed by associates and joint ventures, representing approximately 41% of current debtors. Furthermore, £211,958 is owed to "other creditors" due after more than one year. Given the negative equity, it is highly probable that these long-term creditors are related party/director loans propping up the entity. If these associated entities fail or the director calls in the loan, the company would face immediate insolvency.

2. Positive Indicators

• Positive Working Capital: Despite the overall negative net assets, the company maintains a healthy net current asset position of £127,122. Current assets (£166,701) comfortably cover current liabilities (£39,589), suggesting the company can meet its short-term trade and tax obligations without immediate liquidity crisis.
• Regulatory Compliance: The company is fully up to date with its statutory filing requirements at Companies House. Accounts and confirmation statements are filed on time and not overdue, indicating a basic level of administrative governance.
• Improved Cash Position: Cash at bank and in hand increased from £625 in 2023 to £8,468 in 2024. While the absolute figures are low, the year-on-year improvement suggests slightly better immediate liquidity management than the prior year.

3. Due Diligence Notes

• Long-Term Creditors Investigation: It is critical to determine the nature and terms of the £211,958 in "other creditors" due after one year. Confirmation is needed on whether these are director loans, if they are subordinated, and whether any repayment demands or security interests are attached to them.
• Debtor Recoverability: The £56,145 owed by associates/joint ventures must be scrutinized. An analyst should verify the identities of these associates, their financial stability, and the timeline for recovery. A provision for bad debt against this balance would severely impact the already fragile current asset position.
• Business Model Verification: The discrepancy between the zero-employee headcount, the administrative SIC code, and the construction-focused website requires clarification. Determine if the company operates as a shell/holding company, or if it relies entirely on sub-contracted labor to fulfill construction contracts, and why the SIC code has not been updated to reflect actual operations.