AVRO PROPERTIES LIMITED

Executive Summary

Avro Properties Limited shows significant liquidity and solvency risks due to a large increase in current liabilities and director loans, despite asset growth driven by investment properties. The company’s financial leverage has increased materially, which warrants close scrutiny of its cash flow and debt servicing capacity. Compliance with statutory filings is up to date, but operational sustainability and funding structure require further detailed analysis.

AVRO PROPERTIES LIMITED - Analysis Report

Company Number: 12839344

Analysis Date: 2025-07-20 12:03 UTC

1. Risk Rating: HIGH
   The company exhibits significant liquidity concerns, with net current liabilities substantially exceeding current assets as of the latest financial year. The large increase in short-term liabilities, primarily due to amounts owed to the director, coupled with sizable long-term secured debt, raises solvency questions despite positive net asset figures.

2. Key Concerns:

• Sharp deterioration in net current assets from a positive £15,305 in 2024 to a negative £215,458 in 2025, indicating potential cash flow stress.
• A substantial increase in short-term creditors owed to the director (£218,161 in 2025 vs £19,977 in 2024), which although interest-free and repayable on demand, could indicate reliance on director funding and possible liquidity risk.
• Significant secured bank loans increased markedly from £168,288 to £503,732, increasing financial leverage and fixed charge obligations on investment properties.

3. Positive Indicators:

• The company’s total assets, primarily investment properties, have increased considerably (from £167,164 to £730,768), indicating asset growth and business expansion.
• Net assets remain positive at £11,578, reflecting some equity buffer despite increased liabilities.
• The company is compliant with filing deadlines and maintains an active status with no overdue returns or accounts.

4. Due Diligence Notes:

• Review the terms and repayment schedule of the secured bank loans and the director’s loan account to assess repayment risks and potential refinancing needs.
• Investigate the cash flow projections and operational income from the investment properties to determine the sustainability of current liabilities coverage.
• Examine the absence of employees and the company’s operational model to understand revenue generation and ongoing operational expenses.
• Confirm that asset valuations (investment properties) are supported by independent appraisals, given the large increase in fixed assets on the balance sheet.
• Assess any contingent liabilities or off-balance sheet commitments not reflected in the accounts.