AUTONOMOUS AGRI SOLUTIONS LTD

Executive Summary

Autonomous Agri Solutions Ltd has shown marked improvement in its net asset position and shareholder funds, indicating growing financial strength. However, ongoing negative working capital and finance lease liabilities present short-term liquidity risks that require close monitoring. Conditional credit approval is recommended, contingent on continued improvement in cash flow and working capital management.

AUTONOMOUS AGRI SOLUTIONS LTD - Analysis Report

Company Number: 12945254

Analysis Date: 2025-07-20 16:50 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   Autonomous Agri Solutions Ltd shows improving financial stability with positive net assets and shareholder funds growth from £12,766 in 2023 to £56,389 in 2024. However, the company has a persistent working capital deficit (net current liabilities of £63,061 in 2024), indicating short-term liquidity pressure. The presence of finance lease obligations totaling £22,076 adds to fixed financial commitments. Given its young age (incorporated 2020) and growth trajectory, credit can be extended but with conditions: monitor cash flow closely and ensure covenant compliance concerning liquidity and debt servicing.

2. Financial Strength:
   The company’s balance sheet has strengthened significantly over the last year. Fixed assets remain substantial (£140,974) and stable, reflecting investment in plant, machinery, and equipment relevant to their wholesale agricultural machinery business. Net assets have increased over fourfold year-on-year, predominantly driven by retained earnings as the company moves from a net liability position in prior years to a positive equity base (£56,389). The company carries finance lease liabilities, which should be factored into long-term obligations but does not have long-term bank debt reported. The share capital is nominal (£100), so capital injections have been through retained profits or related-party funding.

3. Cash Flow Assessment:
   Current assets are £128,770, with cash balances improving to £57,633 (up from £40,547). However, current liabilities remain high at £191,831, causing a negative working capital position. Trade debtors have fallen sharply (£3,377 vs £45,075 prior year), possibly indicating improved collections or reduced sales on credit, while stocks have doubled (£53,039 vs £24,501), which could indicate inventory build-up. The company must manage this working capital imbalance carefully to avoid liquidity stress. The finance lease payments add fixed cash outflows that must be covered by operating cash flows.

4. Monitoring Points:

• Liquidity ratios (current ratio and quick ratio) to ensure working capital improves or at least remains manageable.
• Debtor days and inventory turnover to monitor cash conversion cycle efficiency.
• Timely servicing of finance lease payments and adherence to any financial covenants.
• Profitability trends and cash flow from operations to ensure underlying business growth supports debt obligations.
• Any changes in director or shareholder control, especially given significant control by Mr. Beach and Autonomous Agri Group Limited.