A&M HOSPITALITY GROUP LIMITED

Executive Summary

A&M Hospitality Group Limited has improved its financial position with increased fixed assets and equity but continues to operate with negative working capital and significant long-term liabilities. The lack of profitability data limits full credit risk evaluation. Conditional approval is recommended, with close monitoring of liquidity and cash flow to ensure the business sustains debt servicing and operational needs.

A&M HOSPITALITY GROUP LIMITED - Analysis Report

Company Number: 13667258

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

1. Credit Opinion: CONDITIONAL APPROVAL
   A&M Hospitality Group Limited shows significant improvement in net assets from a negative £15,645 in 2022 to a positive £15,907 in 2023, primarily due to a substantial increase in fixed assets and share premium. However, the company currently carries a working capital deficit (net current liabilities of £23,390) and has significant long-term creditors (£463,348), which creates liquidity risk. The absence of an income statement and profitability data limits assessment of ongoing cash generation. Approval is conditional upon monitoring cash flow closely and confirmation of sustainable operating cash inflows to service short and long-term obligations.

2. Financial Strength:
   The balance sheet reflects a major increase in fixed assets (£502,645 in 2023 from £5,255 in 2022), driven by additions to tangible fixed assets (£198,441 net book value) and a £300,000 investment in a group undertaking. This investment and asset base support future business capacity. Shareholders' funds have increased to £134,990 (including share premium) from a negative position, indicating improved capitalization. However, the company’s net current liabilities and large long-term creditors (bank loans and other creditors) pose solvency concerns if asset liquidity is poor or cash flow weak.

3. Cash Flow Assessment:
   Cash at bank is modest at £10,192, with current assets (£73,125) insufficient to cover current liabilities (£96,515), resulting in a negative working capital position. Trade debtors (£1,820) and amounts owed by group undertakings (£60,013) form a large portion of current assets but may not be readily realisable. The company’s ability to meet short-term obligations relies on timely collection of receivables and cash flow from operations, which is not disclosed. The presence of long-term debt of £45,331 and other creditors of £418,017 requires reliable cash generation or refinancing options to avoid liquidity stress.

4. Monitoring Points:

• Liquidity ratios, particularly current ratio and quick ratio, to track short-term payment capability.
• Receivables ageing and realisability, especially amounts owed by group companies.
• Profitability and operating cash flow trends once income statements become available.
• Debt servicing capacity and refinancing risk related to long-term creditors.
• Changes in fixed asset utilization and impairment risks.
• Director and management actions on working capital management.