BAKER STREET OPTICAL LIMITED

Executive Summary

BAKER STREET OPTICAL LIMITED is a micro-entity with improving net assets and stable working capital but carries significant long-term liabilities relative to equity. The company’s financial profile and limited operating history warrant cautious credit exposure, ideally with limits and collateral. Regular monitoring of liquidity and debt levels is essential to mitigate risk.

BAKER STREET OPTICAL LIMITED - Analysis Report

Company Number: 14058281

Analysis Date: 2025-07-29 17:53 UTC

1. Credit Opinion: CONDITIONAL APPROVAL
   BAKER STREET OPTICAL LIMITED demonstrates modest but improving net assets and stable working capital. However, the company is relatively young (incorporated 2022) and operates at a micro-entity scale with limited financial history. The significant long-term liabilities (creditors due after one year) are substantial relative to net assets, which poses a risk. Without an audit, the financial controls and completeness of information cannot be fully verified. Loan or credit exposure should be limited and subject to regular monitoring. Approval may be granted with credit limits aligned with the company’s size and secured where possible.

2. Financial Strength:
   The balance sheet shows fixed assets around £319k and current assets circa £93k, with current liabilities approximately £71k, resulting in positive net current assets of £22k. However, there are significant non-current liabilities of £273k, reducing net assets to £67k as of April 2024, an improvement from £11k the previous year. This improvement indicates some strengthening of equity. The company’s capital base remains modest, reflecting its micro-entity status and early-stage development. The low number of employees (5) and stable fixed asset base suggest a small, asset-light retail operation.

3. Cash Flow Assessment:
   Current assets primarily include cash and stock (not detailed), supporting short-term liquidity. The net current assets position is positive but slim, indicating limited working capital buffer. The reduction in current liabilities from the prior year is a positive sign. However, the scale of long-term liabilities relative to equity may strain cash flows if repayment obligations crystallize. No detailed profit and loss or cash flow statement is available, but the lack of audit and limited information on revenue or profit margins suggests caution. The company should maintain tight control over receivables and inventory and monitor creditor terms closely.

4. Monitoring Points:

• Track changes in non-current liabilities to ensure no material increase in long-term debt risk.
• Monitor net current assets and liquidity ratios quarterly to detect cash flow stress early.
• Review any forthcoming financial accounts filing for profit/loss details and cash flow statements.
• Confirm directors’ continued financial stewardship and absence of related party transactions or financial irregularities.
• Watch for any overdue filings or changes in company status that may indicate distress.