Company Number: 13886462

Analysis Date: 2025-07-29 19:23 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity risks, with persistent net liabilities and negative working capital over multiple years. The substantial secured loan exceeding total asset values raises concerns about financial stability.

2. Key Concerns:

• Negative Net Assets: The company reported net liabilities of £4,485 in 2023, indicating that total liabilities exceed total assets, which is a solvency red flag.
• Negative Net Current Assets: Persistent negative working capital (~-£80k) suggests cash flow constraints and difficulty meeting short-term obligations.
• High Secured Debt: The loan of £177,170 secured by a fixed charge on the property exceeds total assets less current liabilities, indicating high leverage and potential risk of default if cash flows are insufficient.

3. Positive Indicators:

• Investment Property Holding: The company holds investment property valued at £247,959, which is a significant fixed asset and potential source of value or income.
• No Overdue Filings: Both accounts and confirmation statements are filed on time, indicating compliance with regulatory requirements.
• Established Directors and PSCs: Directors and persons with significant control are stable since incorporation, with no reported disqualifications or governance issues.

4. Due Diligence Notes:

• Cash Flow & Income Details: Obtain detailed income statement and cash flow statements to assess operational profitability and ability to service debt. The absence of an income statement limits assessment of earnings capacity.
• Loan Terms and Repayment Schedule: Clarify terms of the secured loan(s), including maturity, covenants, and repayment ability given current cash flows.
• Valuation of Investment Property: Confirm the valuation method and whether the property can be liquidated or leveraged further in distress scenarios.
• Future Business Plans: Understand strategic plans to improve liquidity and solvency, including prospects for rental income or asset sales.
• Related Party Loans: Review the nature and terms of related party loans totaling over £80k to assess any contingent risks or support arrangements.