Company Number: 12546570

Analysis Date: 2025-07-20 13:02 UTC

1. Risk Rating: MEDIUM

The company demonstrates growing net assets and positive working capital, indicating some financial stability. However, the significant increase in fixed assets financed partly through hire purchase contracts and notable provisions raise moderate solvency and liquidity concerns. The company is current with filings and active, which supports regulatory compliance.

2. Key Concerns:

• Hire Purchase Commitments: The fixed assets include a substantial portion (£773k net book value) held under hire purchase agreements with corresponding liabilities, which may pressure cash flows if not managed prudently.
• Provisions for Liabilities: Increase in provisions from £123k to £307k suggests potential contingent liabilities or risks that could impact future solvency.
• Limited Share Capital: The nominal share capital of £1 may indicate minimal shareholder equity buffer, potentially limiting the company's ability to absorb losses or raise further equity.

3. Positive Indicators:

• Strong Growth in Net Assets: Net assets have grown from £347k in 2021 to over £1 million in 2024, reflecting retained earnings accumulation and business expansion.
• Healthy Working Capital: Net current assets improved significantly to £538k in 2024, supported by increased cash balances (£828k) and manageable current liabilities.
• Timely Regulatory Filings: The company is up to date with accounts and confirmation statements, indicating compliance and good governance practices.
• Experienced Control: The sole significant controller has full ownership and voting rights, which may streamline decision-making and strategic direction.

4. Due Diligence Notes:

• Review the nature and terms of hire purchase contracts to assess repayment schedules, interest burdens, and potential refinancing risks.
• Investigate the reasons behind increased provisions for liabilities to understand possible contingent risks or ongoing disputes.
• Examine cash flow statements to verify actual liquidity trends beyond balance sheet snapshots.
• Confirm the company's contract pipeline and revenue stability within the construction of roads and motorways sector, which can be cyclical.
• Evaluate management and operational controls in place given the growth and capital commitments.