BIRSANU LAND & PROPERTY LIMITED

Executive Summary

Birsanu Land & Property Limited exhibits a concerning liquidity position with significant negative working capital and high creditor balances relative to assets. While the company is compliant with filing requirements and holds substantial fixed assets, its minimal equity and persistent short-term funding gap represent elevated solvency and operational risks. Further investigation into creditor terms and asset realizability is recommended to clarify financial stability.

BIRSANU LAND & PROPERTY LIMITED - Analysis Report

Company Number: 12601991

Analysis Date: 2025-07-29 16:08 UTC

1. Risk Rating: HIGH
   Justification: The company’s financials show persistent and significant net current liabilities (negative working capital) exceeding £360k, indicating liquidity stress. Despite owning substantial fixed assets (£892k), the company’s ability to meet short-term obligations is questionable. Net assets are very low (£11k), reflecting a weak equity buffer against liabilities.

2. Key Concerns:

• Liquidity Deficit: The current liabilities (~£518k) far exceed current assets (~£42k), resulting in a net current liability position that has worsened over recent years. This poses a risk of cash flow shortfalls for operational needs and debt servicing.
• High Long-Term Creditors: Creditors due after one year are nearly £518k, close to fixed asset value, suggesting high leverage and potential solvency risk if asset values decline or cannot be realized timely.
• Minimal Share Capital and Equity: Share capital is only £2, and shareholder funds are just £11k, indicating very thin capitalization and limited financial resilience to absorb losses or adverse events.

3. Positive Indicators:

• Stable Fixed Asset Base: Fixed assets have increased significantly from £136k in 2020 to £893k in 2024, reflecting growth in property holdings which may provide collateral value.
• Timely Filings and Compliance: No overdue accounts or confirmation statements, and the company maintains active status without liquidation or administration proceedings. This suggests good regulatory compliance and governance practice.
• Experienced Directors: The company is led by directors with consistent involvement since inception, which may support operational continuity.

4. Due Diligence Notes:

• Investigate the nature and terms of the company’s creditors, especially those due after one year, to assess risk of default or restructuring needs.
• Verify the valuation and marketability of fixed assets to confirm their realizable value under stress conditions.
• Review cash flow statements and bank facilities to understand liquidity management and potential funding sources.
• Assess the company’s business model sustainability given the negative working capital and ongoing operational expenses.
• Confirm there are no director disqualifications or regulatory compliance issues beyond what is publicly available.