ARRIVAL LABS LTD

Executive Summary

Arrival Labs Ltd shows promising financial improvement with positive net assets and working capital in its first full year. Despite limited trading history and small asset base, the company demonstrates adequate short-term liquidity to meet obligations. Credit approval is recommended with prudent exposure limits and ongoing liquidity monitoring.

ARRIVAL LABS LTD - Analysis Report

Company Number: 15022466

Analysis Date: 2025-07-20 17:55 UTC

1. Credit Opinion: APPROVE with conditions. Arrival Labs Ltd is a recently incorporated micro private limited company operating in the niche sector of computer games publishing. Its latest financials indicate a substantial improvement in net assets and working capital position compared to the prior year. While no profit and loss data is available due to micro-entity reporting exemptions, the balance sheet shows positive signs of financial stability. However, the company's short trading history and relatively low asset base suggest limiting credit exposure and monitoring liquidity closely.

2. Financial Strength: The company’s financial position as of 31 March 2025 shows net assets of £15,437, a significant increase from £23 the previous year. Fixed assets decreased slightly to £2,871 but current assets rose markedly to £27,353, driven by prepayments and accrued income of £11,308 and improved cash or receivables. Current liabilities rose to £25,135 but net current assets are positive at £13,526, indicating adequate short-term solvency. Shareholders’ funds mirror net assets, confirming equity backing. The balance sheet indicates a sound financial footing for a micro company.

3. Cash Flow Assessment: The current ratio (current assets/current liabilities) is approximately 1.09 (27,353/25,135), which is marginally above 1, showing the company can cover short-term obligations but with limited buffer. The improvement from a negative net working capital in the prior year (-£5,337) to a positive £13,526 is encouraging, reflecting better liquidity management or increased cash inflows. Absence of detailed cash flow statements or profit figures limits thorough assessment, so ongoing monitoring of cash conversion cycles and working capital efficiency is recommended.

4. Monitoring Points:

• Watch for timely filing of full accounts and P&L disclosures when thresholds are exceeded.
• Monitor working capital trends and current ratio to ensure liquidity remains adequate.
• Track growth in fixed assets and any debt financing that may affect leverage.
• Keep an eye on the directors’ management and related party transactions given the shareholding concentration among three individuals.
• Review credit exposure limits carefully given the early stage of the company and limited financial history.