AP HOME IMPROVEMENTS (DAVENTRY) LTD

Executive Summary

AP Home Improvements (Daventry) Ltd demonstrates significant financial weakness with persistent net liabilities and negative working capital, raising concerns about its ability to meet short-term obligations and sustain operations. The company’s current financial position and lack of profitability data warrant a decline for credit facilities at this stage. Ongoing monitoring of liquidity and operational performance is essential to reassess creditworthiness in the future.

AP HOME IMPROVEMENTS (DAVENTRY) LTD - Analysis Report

Company Number: 13789032

Analysis Date: 2025-07-20 17:08 UTC

1. Credit Opinion: DECLINE
   AP Home Improvements (Daventry) Ltd exhibits weak financial health with significant net liabilities and ongoing negative working capital. The company’s net current liabilities improved somewhat in 2023 (£-3,605) compared to 2022 (£-13,883), but it remains substantially undercapitalized with net liabilities of £-13,235. This negative equity position indicates an inability to meet short-term obligations from current assets and an overall deficit in net assets. The absence of profitability data and reliance on micro-entity accounting standards with no audit further limits transparency. The company’s high creditor balances and persistent net liabilities suggest elevated credit risk. Without clear evidence of profitability or cash flow improvement, extending credit facilities would be imprudent.

2. Financial Strength:
   The balance sheet shows persistent net liabilities and negative shareholders’ funds for the three years reported. Current assets are minimal (£1,043 in 2023) compared to current liabilities (£9,630), yielding a net current asset deficit of £-3,605. The company’s long-term creditors (£9,630) further worsen the financial position. This structural weakness reflects insufficient capital injection or accumulated losses. With only two employees and micro-entity reporting, the company operates on a very small scale but still fails to maintain positive equity or working capital. The financial trajectory, while showing slight improvement in working capital, remains negative and indicates ongoing financial stress.

3. Cash Flow Assessment:
   Given the low current assets primarily consisting of cash or receivables, and high current liabilities, liquidity is constrained. Negative net current assets imply the company may struggle to meet short-term creditor demands without additional financing or capital injections. The absence of detailed profit and loss or cash flow statements restricts precise cash flow analysis, but the balance sheet signals limited operational cash generation. The company’s ongoing ability to fund operations from internal cash flows is uncertain, increasing reliance on external funding or director support.

4. Monitoring Points:

• Track net current assets and liquidity ratios to detect any improvements or further deterioration.
• Monitor creditor days and payment terms to assess operational cash flow pressures.
• Review any future filings for profit or loss trends to evaluate operational performance.
• Observe director actions for capital injections or restructuring efforts to restore solvency.
• Watch for any late filings or changes in company status that might indicate distress.