ARGENTO EQUESTRIAN LIMITED

Executive Summary

Argento Equestrian Limited shows growth in turnover but faces significant solvency and liquidity risks due to negative net assets and working capital deficits. The company’s operational performance is under pressure with a recent loss despite increased sales. While regulatory compliance and leadership stability are positives, further detailed financial and operational due diligence is required to evaluate the company’s sustainability and investment risk.

ARGENTO EQUESTRIAN LIMITED - Analysis Report

Company Number: 12597625

Analysis Date: 2025-07-20 16:07 UTC

1. Risk Rating: HIGH
   The company exhibits a concerning financial position with negative net assets as at 31 May 2024, indicating solvency risk. Net current liabilities have increased year-on-year, and the company reported a loss in the latest period despite turnover growth, suggesting liquidity and operational challenges.

2. Key Concerns:

• Negative Net Assets: The balance sheet shows net liabilities of £6,685 as of 2024, a deterioration from a positive net asset position in prior years, indicating potential solvency issues.
• Persistent Working Capital Deficit: Current liabilities exceed current assets by £29,026, raising liquidity concerns about meeting short-term obligations.
• Operating Loss Despite Revenue Growth: The company generated a small loss (£5,341) in 2024 despite turnover increasing by approximately 30%, indicating margins are under pressure and operational stability may be fragile.

3. Positive Indicators:

• Increasing Turnover: The company’s revenue has grown from £148k in 2020 to over £510k in 2024, showing business expansion and market traction.
• Timely Compliance: No overdue filings for accounts or confirmation statements, demonstrating good regulatory compliance and governance practices.
• Stable Management: The sole director has been in place since incorporation with no reported disqualifications, suggesting continuity in leadership.

4. Due Diligence Notes:

• Investigate Cash Flow and Creditors: Examine detailed cash flow statements and creditor aging to assess liquidity strain and payment practices.
• Review Cost Structure and Profitability Drivers: Analyze why increased turnover is not translating into profits, focusing on cost of materials and other charges that increased substantially.
• Capital Structure and Funding: Clarify the extent of external financing, shareholder support, or plans to recapitalize given the negative equity position.
• Business Model Sustainability: Understand the equestrian wholesale market dynamics and competitive positioning to assess longer-term viability.