CAFE TREE LIMITED

Executive Summary

CAFE TREE LIMITED exhibits significant financial distress evidenced by negative net assets and net current assets, indicating high solvency and liquidity risk. While compliance with filing obligations is maintained and the company remains active, recent management changes and minimal financial resources raise concerns about operational stability. Further due diligence is recommended to clarify liabilities, management continuity, and business activity alignment.

CAFE TREE LIMITED - Analysis Report

Company Number: 14672853

Analysis Date: 2025-07-29 20:18 UTC

1. Risk Rating: HIGH
   Justification: The company shows negative net current assets (-£1,288) and negative net assets/shareholders’ funds (-£1,478) at the last financial year end, indicating insolvency on a balance sheet basis. The company is newly incorporated (2023) with only micro-entity accounts filed, and limited current assets (£150) against liabilities (£1,438), highlighting significant liquidity risk.

2. Key Concerns:

• Negative net assets and net current assets suggest the company is financially distressed and may be unable to meet short-term liabilities.
• The company has undergone a recent change in control and director (June 2025), which may reflect operational or governance instability.
• Limited financial data and small scale (micro-entity) with minimal assets pose challenges to assessing sustainability and operational performance.

3. Positive Indicators:

• The company is currently active and not in liquidation or administration, indicating ongoing operations.
• No overdue accounts or confirmation statements have been filed, implying compliance with filing deadlines and regulatory requirements to date.
• The presence of a shareholder with 75-100% control and right to appoint directors may allow for decisive governance actions.

4. Due Diligence Notes:

• Investigate the nature of the liabilities and creditors to understand the short-term obligations and any potential payment defaults.
• Clarify the impact and reason for recent director resignation and appointment in June 2025 to assess management stability.
• Request more detailed management accounts or cash flow forecasts to assess ongoing liquidity and operational viability beyond the limited micro-entity accounts.
• Verify the business activity aligns with SIC code 56102 (unlicensed restaurants and cafes) given the prior description as Temporary employment agency activities in the accounts document, to confirm consistency in business operations.