BADA BING GARMENTS LTD

Executive Summary

Bada Bing Garments Ltd has experienced a severe decline in financial health over the last year, marked by negative working capital and sharply reduced cash reserves. The company’s weak liquidity and near depletion of equity underpin a high risk of default on obligations. Credit extension is not recommended without significant improvement in cash flow or capital support.

BADA BING GARMENTS LTD - Analysis Report

Company Number: SC682314

Analysis Date: 2025-07-29 20:24 UTC

1. Credit Opinion: DECLINE
   Bada Bing Garments Ltd shows a significant deterioration in its financial position in the latest year ending November 2024. Net current liabilities of £1,273 and a drop in shareholders’ funds from £6,168 in 2023 to £239 in 2024 indicate acute liquidity stress and erosion of equity. The company’s current assets have sharply declined from £20,994 to £2,992, mainly driven by a steep fall in cash from £19,250 to £722, raising concerns about its ability to meet short-term obligations. Given the negative working capital and extremely limited cash reserves, the company is at high risk of defaulting on its debts. Without clear evidence of imminent capital injection or turnaround, extending credit is not advisable.

2. Financial Strength:
   The balance sheet reveals a weak financial structure. The fixed asset base is minimal (£1,512 net) and the company is heavily reliant on current assets to fund liabilities. The drastic shrinkage in net current assets from a healthy £6,168 in 2023 to a deficit £1,273 in 2024 reflects either operational difficulties or poor cash management. Shareholders’ funds have been nearly wiped out, indicating accumulated losses or withdrawals. The company remains a micro-entity with minimal capital (£100 share capital) and a single director controlling all shares, which may limit access to additional funding sources.

3. Cash Flow Assessment:
   Cash availability is critically low at £722, representing less than 20% of current liabilities (£4,265). Debtors are modest (£2,270) and may not be sufficient or quickly collectible to support liquidity needs. The company’s cash flow is strained, and working capital is negative, suggesting an inability to cover short-term debts without external support. The absence of an income statement in the filing limits profit and operational cash flow visibility, but the balance sheet features point to ongoing cash burn or delayed receivables.

4. Monitoring Points:

• Monitor cash balances and debtor collections closely, particularly any improvement in liquidity.
• Track creditor payments and any defaults or late payments that may arise.
• Watch for any equity injections or director loans that could restore net assets and solvency.
• Review upcoming filed accounts for evidence of operational recovery or worsening losses.
• Assess management actions addressing liquidity issues and business sustainability.