Company Number: SC708424

Analysis Date: 2025-07-20 12:22 UTC

1. Credit Opinion: DECLINE. Almondine Ltd demonstrates persistent negative working capital, with current liabilities significantly exceeding current assets by approximately £28,889 as of the latest year-end. Although the company has modest net assets (£1,540), the deficit in liquidity raises concerns on its ability to meet short-term obligations. Bank loans and overdrafts have doubled in the year to £20,300, increasing financial risk. The company is very young (incorporated 2021) and operates in the competitive unlicensed restaurant and café sector, which can be vulnerable to economic fluctuations. Without evidence of consistent positive cash flow or a clear plan to improve liquidity, credit exposure is high.

2. Financial Strength: The balance sheet shows total fixed assets of £35,594, primarily tangible assets (fixtures, plant, and machinery). Net assets remain positive but minimal at £1,540, with retained earnings slightly increased to £1,537. Provisions for liabilities are material at £5,165, indicating some contingent obligations or accruals. The company has a negative net current asset position (working capital deficit) of nearly £29k, signaling tight liquidity. The increase in creditors, including bank loans and overdrafts, points to growing reliance on external financing. Overall, the company has a weak financial buffer and limited equity base.

3. Cash Flow Assessment: Cash on hand remains very low (£400), and debtors, though increased to £14,798, are insufficient to cover the elevated current liabilities of £57,487. The company’s working capital management appears strained, with trade creditors and other creditors collectively substantial. The doubling of bank loans and overdrafts suggests reliance on short-term borrowing to fund operations, which is risky without a stable cash inflow. The absence of an income statement limits assessment of profitability, but the balance sheet indicates operational stress. Liquidity risk is high, and the company may face challenges servicing debt or supplier payments without additional capital injection.

4. Monitoring Points:

• Working capital and liquidity trends, especially cash balances relative to current liabilities.
• Bank borrowings and overdraft usage—monitor for signs of over-reliance on short-term debt.
• Debtor collection efficiency and aging profile to assess cash conversion.
• Any changes in provisions for liabilities that may impact future cash outflows.
• Management actions to improve profitability or secure additional equity funding.
• Timely filing of accounts and confirmation statements to ensure compliance and transparency.