ARTHUR STANLEY DEVELOPMENTS LTD

Executive Summary

Arthur Stanley Developments Ltd is currently in a financially weak position with negative net assets and worsening working capital deficits, raising serious concerns about its ability to service debt and meet short-term liabilities. Liquidity constraints and reliance on creditor funding indicate elevated credit risk, leading to a recommendation to decline credit facilities at this time. Close monitoring of liquidity and operational cash flow is essential should the company’s financial position improve in the future.

ARTHUR STANLEY DEVELOPMENTS LTD - Analysis Report

Company Number: 12646967

Analysis Date: 2025-07-20 18:48 UTC

1. Credit Opinion: DECLINE
   Arthur Stanley Developments Ltd demonstrates weak financial health with persistent and increasing net liabilities over the last four years. The company’s net assets and shareholder funds are significantly negative (£-22,595 as of June 2024), indicating that liabilities exceed assets. The company’s working capital position is also negative and worsening (net current liabilities of £-28,721 in 2024), suggesting liquidity issues. These factors indicate an inability to comfortably service debt or meet short-term obligations. Additionally, the company has no employees other than the director, which may limit operational resilience. Given the continuous deficit and erosion of shareholder equity, credit risk is high, and approval for additional credit facilities is not advised at this time.

2. Financial Strength:
   The balance sheet reveals a small fixed asset base (£7,563) primarily consisting of plant and motor vehicles, and stocks/work in progress valued at £253,627, which seem to be the major current asset component. However, current liabilities have increased substantially to £285,678, leading to a negative net working capital position. Deferred tax liabilities have also increased. The company has consistently reported negative net assets since inception, indicating ongoing losses or capital injections insufficient to cover liabilities. The absence of any disclosed PSCs or additional equity injections is a concern. The balance sheet structure shows a company in a fragile financial state reliant on creditor financing.

3. Cash Flow Assessment:
   Cash balances are very low (£1,489 in 2024), and the company’s net current liabilities position indicates a working capital deficit. Debtors are minimal (£1,841) relative to creditors (£285,678), suggesting limited short-term cash inflows. The large stock/work-in-progress balance implies that cash is tied up in projects not yet realized as revenue. The company’s liquidity is constrained, and it relies on creditor funding to continue operations. Without improvement in cash generation or capital support, the company’s ability to meet immediate financial obligations is doubtful.

4. Monitoring Points:

• Track changes in net current assets and overall liquidity position quarterly.
• Monitor stock/work-in-progress turnover and realization into cash or receivables.
• Review creditor terms and any changes in creditor balances to assess refinancing risk.
• Watch for any capital injections or restructuring plans aimed at restoring positive equity.
• Monitor director’s statements and filings for indications of going concern issues or insolvency risk.