Company Number: 12621848

Analysis Date: 2025-07-20 14:59 UTC

1. Risk Rating: MEDIUM
   The company shows improving net asset position and positive net current assets in the latest year, indicating progress toward solvency. However, relatively high long-term creditors compared to net assets and previous years' volatility in equity raise moderate concerns.

2. Key Concerns:

• Leverage and Long-Term Creditors: Significant creditors due after more than one year (£88,873 in 2024) relative to modest net assets (£19,961) may indicate dependence on external financing, potentially stressing solvency if cash flows falter.
• Volatility in Net Assets / Shareholders’ Funds: Negative net assets in 2023 (-£273) and sharp fluctuations in net current assets in prior years suggest inconsistent financial stability and possibly prior losses or restructuring.
• Limited Scale and Resources: As a micro-entity with only one employee and minimal share capital (£720), the company’s small scale may limit operational resilience and ability to absorb shocks.

3. Positive Indicators:

• Improved Financial Position in 2024: Net current assets increased substantially to £108,834, and net assets moved into positive territory, indicating improved liquidity and solvency compared to prior years.
• Timely Compliance: No overdue filings; accounts and confirmation statements are up to date, reflecting good governance and regulatory compliance.
• Clear Operational Focus: Established SIC codes (online and physical retail of clothing) suggest a defined business model, which supports operational stability.

4. Due Diligence Notes:

• Review the nature and terms of the long-term creditors to assess repayment risk and potential covenants or guarantees.
• Examine cash flow statements (not provided) to verify liquidity trends and working capital management.
• Investigate the causes of prior years’ negative net assets and the steps taken to restore financial health.
• Confirm whether any director or related party loans exist, given the relatively small shareholder funds.
• Assess sales growth and profit margins given the retail sector focus, to evaluate sustainability of recent improvements.