BADRAN BAKERY LTD

Executive Summary

Badran Bakery Ltd is currently facing substantial solvency and liquidity challenges, reflected in persistent negative net assets and significant working capital deficits. While regulatory compliance is maintained, the financial position raises concerns about the company's ability to continue meeting obligations without intervention or restructuring. Further investigation into liabilities and management strategies is recommended before considering investment.

BADRAN BAKERY LTD - Analysis Report

Company Number: 12554753

Analysis Date: 2025-07-20 13:10 UTC

1. Risk Rating: HIGH
   Justification: The company exhibits persistent and significant negative net assets and net current assets, indicating ongoing solvency issues. The current liabilities far exceed current assets, raising liquidity concerns.

2. Key Concerns:

   • Solvency Risk: The net liabilities position has worsened over several years, with net assets at -£67,523 as of April 2024 and consistently negative net current assets (working capital deficit of -£82,216), which implies the company may struggle to meet its short-term and long-term obligations.
   • Liquidity Concerns: Current liabilities (£91,456) exceed current assets (£9,240) by a wide margin, suggesting poor short-term liquidity and possible cash flow difficulties.
   • Sustainability of Operations: Despite being active since 2020, the company has not demonstrated an improvement in financial health, with continued losses reflected in negative equity and lack of growth in fixed assets or current assets that might support operational stability.

3. Positive Indicators:

   • Compliance: The company is up to date on all filings, including accounts and confirmation statements, with no overdue returns or accounts, indicating good regulatory compliance.
   • Stable Directorship: The sole director has been in place since incorporation, which may indicate stable management.
   • Micro-Entity Status: The company benefits from simplified reporting requirements, which may reduce administrative burdens.

4. Due Diligence Notes:

   • Investigate the nature and terms of the current liabilities to assess if there is a risk of default or creditor action.
   • Review management plans or strategies for returning to profitability and improving solvency.
   • Assess whether there are any contingent liabilities or off-balance sheet obligations not reflected in the accounts.
   • Clarify the source of funding or capital injections that have sustained the company despite losses.
   • Confirm if there are any director loans or related party transactions that impact financial stability.